The world's "unbanked" population shrank by 20 percent to 2 billion adults between 2011 and 2014 as 700 million gained access to financial services, according to the World Bank, evidence of progress in its ambitious goal for universal financial access by 2020.
Over the four-year period, the percentage of adults with an account at a financial institution or mobile money service provider, grew to 62 percent from 51 percent, the World Bank's 2014 Global Findex report published on Wednesday, showed.
"Access to financial services can serve as a bridge out of poverty...Now we have evidence that we're making major progress," said Jim Yong Kim, president at the World Bank.
"This effort will require many partners – credit card companies, banks, microcredit institutions, the United Nations, foundations, and community leaders. But we can do it, and the payoff will be millions of people lifted out of poverty," he said.
Growth in account ownership was led by developing nations, including Mexico, Brazil, India, China, Tanzania and Indonesia.
Mobile banking
The rise of mobile financial services played a key role in expanding financial inclusion in emerging markets, particularly Sub-Saharan Africa.
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Twelve percent of adults in the region have a mobile money account compared to just 2 percent globally, the report said. Kenya leads with mobile money account ownership at 58 percent, followed by Tanzania and Uganda with rates of about 35 percent.
In Kenya, more than half of adults who pay utility bills use a mobile phone to do so. While in Tanzania, nearly a quarter of those receiving payments for the sale of agricultural products do so into a mobile account.
Financial inclusion = poverty reduction
Financial inclusion, defined by the Global Findex as having an account that allows adults to store money and make and receive electronic payments, is viewed as pivotal in poverty eradication.
When individuals can participate in the financial system, they are better able to start and expand businesses, invest in their children's education and absorb financial shocks.
"Having a bank account being able to save, being able to get money directly from government or other sources… this is going to democratize and make much easier the handling of money, the saving of money and getting access to credit," Kim said.
The next steps
There is still more work to be done to improve financial inclusion, however, particularly among women and the poorest households.
More than half of adults in the poorest 40 percent of households in developing countries were still without accounts last year.
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As for the gender gap in account ownership, 59 percent of men globally had an account in 2014 compared to 50 percent of women. Regionally, the gender gap in account ownership is largest in South Asia at 55 percent vs 37 percent.
"When a woman has an account and a safe place to save outside the home, she also has greater control over finances and household incomes," said Sri Mulyani Indrawati, Managing Director and Chief Operating Officer of the World Bank.
"Equipped with access to formal savings and credit, women participate more in the economy. They can set aside funds for emergencies, for schooling, or for starting a business. This is an important stepping stone out of poverty and towards more equality."