Mongolian Remote Communities and Digital Banking Transformation

Abstract

Although Mongolia has set up a nationwide Internet network as part of its goal of becoming a digital nation, remote communities are unable to have equal access to education, government services and other services due to inadequate infrastructure during the COVID-19 period. As mobile communications and the Internet expand, customers are becoming increasingly familiar with mobile banking and Internet banking services. The uses of digital technology such as artificial intelligence, digital banking services based on big data have increased in recent years. The benefits of this digital transformation for banks should be shared equally by all customers. This paper assesses the equality of banking services based on reports on mobile banking transactions and reports on Internet connection of citizens in Mongolian’s remote communities. The methodology is based on a methodological approach using fixed and random effect estimation and panel analysis based on data from the National Statistics Office of Mongolia, the Mongol Bank and the Communication Regulatory Commission of Mongolia. In this study, we surveyed 421 rural respondents from 21 provinces of Mongolia. This paper’s dependent variables are the number of active mobile users and internet bank active users by province. Independent variables are population density, GDP per capita, workers, spectrum of poverty, average salary by province.