مجلة دراسات الإنسان و المجتمع

This study provides a comprehensive analysis of the informal financial markets in Libya, examining their role and impact on the formal financial sector and the wider economy. Focusing on the characteristics and dynamics of these markets, the research aims to assess their influence on financial inclusion, economic growth, and stability. Employing an analytical methodology, primary data was gathered through structured questionnaires from a diverse sample of 36 respondents, complemented by a thorough review of existing literature. The results reveal a significant correlation between informal financial activities and the Libyan economy, highlighting the accessibility and trustworthiness of informal markets as compared to formal financial institutions. Key factors influencing participation in these markets include financial literacy, regulatory perceptions, and accessibility issues. The findings underscore the importance of policy reforms to integrate informal and formal sectors, enhancing financial literacy and fostering a more inclusive and stable economic environment. This study contributes to the understanding of the dual role of informal markets in economies with high entry barriers and provides valuable insights for policymakers in developing strategies for economic development and financial inclusivity. Keywords: Informal financial transactions, Libyan economy, formal financial services, lack of trust, regulatory environment, and financial inclusion.