HONG KONG - Hong Kong is the second most financially inclusive market out of 42 markets analyzed globally, rising two places year on year, according to a report released on Tuesday.

Hong Kong remains one of the most financially included markets in the world, ranking in the top 10 for all three pillars of financial inclusion, according to the 2023 Global Financial Inclusion Index released by investment management giant Principal Financial Group.

The government support pillar has seen the most significant improvement in driving the state of financial inclusion, rising six spots. Hong Kong continues to rank first for "online connectivity," and topped the ranking for "financial literacy levels," rising 17 spots.

In line with the rise in rankings, Hong Kong saw improvement in public perception of financial inclusion with 89 percent of respondents saying they feel financially included.

"Recovering at full speed from the impacts of COVID-19, Hong Kong remains a strong regional leader in driving financial inclusion," said Thomas Cheong, president of Principal Asia.

Last year's second top market, the United States, drops to the fourth.

The Global Financial Inclusion Index ranks 42 markets on three pillars of financial inclusion -- government, financial system, and employer support -- using data points across public and survey-based sources. These pillars represent the key stakeholders responsible for promoting financial inclusion across the population. The Index was conducted in partnership with the Center for Economics and Business Research, one of Britain's leading economics consultancies.