FEMISE is proud to launch its latest series of policy briefs, stemming from insightful conference papers presented at the FEMISE annual conference. These briefs are rooted in scientific research and offer actionable political recommendations to address critical challenges in the Euro-Mediterranean region.

The objective if this new series of Policy Briefs is to provide policy makers, international organisers, researchers and stakeholders in the EU-Med region with research-based policy recommendations that: advocate a better EU-Med integration;  promote mobilization of investments towards green transition and sustainable economies; empower young people through innovation and entrepreneurship advocacy; and facilitate a better and more equal integration of youth and women, aiming to create pathways for decent employment.

These Policy Briefs aspire to drive impactful dialogue and action across the EU-Med region.

Context

Financial inclusion is increasingly recognized as a critical component of economic empowerment and inclusive development. In the Middle East and North Africa (MENA) region, where nearly one-quarter of the population is aged between 15 and 29, access to financial services remains particularly limited among young people. At the same time, the region continues to face some of the highest youth unemployment rates in the world, alongside persistently low levels of female labour force participation.

While financial inclusion can facilitate savings, access to credit, entrepreneurship, and economic resilience, significant barriers continue to prevent many young people—especially women—from participating fully in formal financial systems. Despite recent advances in digital financial services and fintech solutions, large segments of the population remain excluded from both traditional and digital financial services.

Understanding the drivers of financial exclusion is therefore essential for designing effective policies that support youth empowerment, gender equality, and sustainable economic development. This policy brief examines the determinants of financial inclusion among young people in five Southern Mediterranean countries—Egypt, Jordan, Lebanon, Palestine, and Tunisia—before and during the COVID-19 pandemic. By analysing both traditional financial services and emerging fintech solutions, the study sheds light on the structural and demographic factors shaping financial inclusion across the region.

Summary

This policy brief investigates the factors holding back youth financial inclusion in MENA countries, with a particular focus on age, gender, and labour market participation. Drawing on Global Findex data covering more than 20,000 individuals across Egypt, Jordan, Lebanon, Palestine, and Tunisia between 2011 and 2021, the analysis explores patterns of account ownership and the use of both traditional and digital financial services before and during the COVID-19 pandemic.

The findings reveal a persistent age gap in financial inclusion throughout the period studied. Young people remain less likely than older adults to own financial accounts, although the use of digital financial services increased significantly during the pandemic. In many cases, mobile banking emerged as an alternative means of accessing financial services, partially compensating for lower levels of traditional account ownership among youth.

The analysis also highlights a significant gender dimension. The pandemic widened existing inequalities in account ownership, with young women remaining less financially included than their male counterparts. While fintech adoption has increased among younger women, this progress has not been sufficient to close broader gender gaps in financial inclusion.

Labour market participation emerges as another key determinant. Young people who are employed or self-employed are considerably more likely to own accounts and use financial services than those outside the workforce. The study further finds that limited income remains one of the strongest barriers to financial inclusion, underscoring the close relationship between employment opportunities and access to formal financial systems.

To promote greater financial inclusion among youth, the brief recommends combining both demand-side and supply-side interventions. Priority actions include improving the collection of youth- and gender-disaggregated financial data, expanding financial and digital literacy programmes, developing inclusive regulatory frameworks, reducing administrative and documentation barriers, improving access to financial infrastructure, and designing financial products tailored to the needs of young people and women.

Ultimately, the brief argues that financial inclusion policies cannot succeed in isolation. Expanding access to financial services must be accompanied by broader efforts to promote decent employment opportunities, income generation, and economic inclusion. By addressing both financial and labour market barriers, MENA countries can create more inclusive pathways for youth participation in economic and social development.

Read the full Policy Brief no.19 here.

The opinions and contents of this document are the sole responsibility of the authors and can under no circumstances be regarded as reflecting the position of FEMISE, IEMED, ERF or the AECID