From Financial Fragility to Financial Resilience of Households. A Systematic Review
Keywords:
Financial literacy; financial resilience; financial inclusion; inequalityAbstract
The increasing prevalence of pandemics, climate change-related natural disasters, financial crises and wars is causing income loss, unemployment, indebtedness and ultimate financial fragility among households. Inequality gaps continue to widen, and previous redistributive policies raised the risk of credit growth and indebtedness. This systematic review of the literature sought to identify the causes of household financial fragility and recommend strategies of financial resilience from previous literature. One hundred and twelve (112) articles were retrieved from Scopus for analysis using the PRISMA protocol. The study found that social demographic factors, financial exclusion, inequality, natural disasters, financial illiteracy, digital poverty, and the financial and political system of a country are major drivers of financial fragility. Literature proposes capability-based strategies, such as financial literacy and life skills, resource-based strategies, such as financial inclusion, financial deepening through fintech, and social capital-based strategies, as major strategies for financial resilience. This study recommends the implementation of sound structural reforms that aim to attract investment consistent with job creation, economic development and growth in the country as a major strategy for addressing inequalities and household financial fragility.
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