This agent-based model analyses financial inclusion in Egypt and demonstrates a general, Capability-Approach-aligned framework for building credible, data-grounded policy simulations.

It represents heterogeneous individuals and firms (SMEs) whose financial states, barriers, opportunities, and preferences drive outcomes such as account ownership, digital payments, formal saving and borrowing, and firm formalisation. The model is fitted to data in two stages: initialisation of synthetic populations from micro- and macro-data, and Bayesian calibration of preference parameters while feasibility (what agents can do) is held fixed.

Each calibrated preference movement is read as a transparent, group-specific hypothesis about the drivers of financial-inclusion gaps, for domain experts to review. Evaluated through the Capability Approach, the model decomposes each gap into feasibility and preference components and exposes an uneven opportunity gap across target groups.