Banking on trust:institutional trust and the geography of financial exclusion in Central and Eastern Europe

In this paper we investigate what determines access to banking in Central and Eastern Europe (CEE). The research uses different waves of the OeNB Euro Survey —covering over 91,000 individuals during the period 2012-2020— and pooled and multilevel logit models to analyse how the interplay of trust in institutions, socio-economic attributes, and geographic contexts shapes access to bank accounts, savings deposits, and loans across ten CEE countries. The findings reveal significant disparities in banking inclusion across products: while institutional trust enhances access to current accounts and savings deposits, its impact on loans is weaker. Socio-economic factors and geographical contexts, particularly at the local NUTS3 level, also matter enormously for financial inclusion. National and local economic conditions are key in shaping variations in financial inclusion/exclusion across CEE.