The role of agent characteristics on the BSN's financial inclusion performance

Financial inclusion is widely recognised as one of the engines of inclusive growth of any country. It can be accessed through agency banking at affordable costs and serves the low-income segments of society to facilitate investment and economic growth in the country. Bank Simpanan Nasional (BSN), as a community bank, has been
mandated to provide suitable financial services to facilitate the economic growth in Malaysia. However, Bank Simpanan Nasional (BSN) faces various challenges in implementing financial inclusion. Extensive literature review shows that infrastructure cost, security, customer protection, and agent characteristics as moderators need to be studied for a better understanding of the performance of financial inclusion. Therefore, the purpose of this study, which is guided by agency theory, is to investigate the relationship between infrastructure cost, security, customer protection, agent characteristic, and performance of financial inclusion of Bank Simpanan Nasional (BSN). A cross-sectional survey was carried out among employees of Bank Simpanan Nasional (BSN), who liaise directly with the agents. The study employed stratified random sampling with a sample size of 400. Multiple regression and hierarchical regression analyses were used. The findings show that infrastructure cost, security, and agent characteristics have a positive relationship with financial inclusion performance, while customer protection is found negatively related. The result of the
hierarchical regression analysis (moderation test) reveals that agent characteristics moderate security, customer protection, and performance of financial inclusion relationship. These results offer practical insights to policymakers to make better policy to enhance financial inclusion. Finally, the research limitations and recommendations for future research are outlined.