Shadow financial citizenship and the contradictions of financial inclusion in Pakistan

Financial inclusion tends to be presented as the remedy to financial exclusion. However, this relationship, in which financial inclusion and exclusion are opposites and mutually exclusive, is dubious given the notion of a financial citizenship which confers a right and ability on individuals and households to participate fully in the economy and to accumulate wealth. Despite the growing recognition that financial inclusion is not the same as financial citizenship, the former continues to be presented as a development intervention in the form of tools such as microloans and mobile money. These products reflect a bifurcated financial sector. The connection between these two notions may be highlighted through the concept of shadow financial citizenship. Since strategies that financialize development also bifurcate finance, they execute an inferior form of inclusion and of access to finance. The phenomena of shadow financial citizenship is thus a feature of finance where the needs of the poor are seen to be distinct, and where there is a separation between formal and informal markets.