Impact of Financial inclusion and financial stability: Empirical and theoretical review

Abstract

The foremost objective of this research is to review the connection among the financial inclusion (FI) and banks financial stability (FS). The research article surveys a vest body of literature devoted to evaluating the relationship of among the FI and FS of the banks. The literature review evaluates recent empirical research studies on the impact of FS and banks FS. The research works divided into following part (i) What is financial inclusion (FI) (ii) What is financial stability (FS) (iii) the influence of FI and FS (iv) FI measurement and indicator (v) whether FI lead to enhance the FS. This paper presents the relevant review of imperialistic research on the nexus among the influence of FI on FS since the period of 1995-2020. Abundant research studies to date suggest that FI has positive and significant impact on FS of the banks’ stability. While few other research study also reveals that when FI have negative influence on the FS is due to the without having efficient management when the credit is expanded in this time it will increase the risk for financial stability.