Financial Inclusion Research Articles

Can digital financial inclusion promote the nighttime economy? - New evidence from Chinese counties’ nighttime lighting data and threshold model

In the post-pandemic era, the relative weakness of the economy is reflected not only in the macro data but also in the nighttime economy. Based on the threshold model and unbalanced panel data of 1772 county-level administrative units in China from 2014 to 2020, this paper deeply explores the relationship between digital inclusive finance and night economy and draws the following conclusions. (1) When digital financial inclusion exceeds certain thresholds, its beneficial influence on promoting the nighttime economy increases from 8.13% to 26.59% and 87.71%. (2) Digital financial inclusion promotes the nighttime economy by increasing employment in the secondary industry and promoting technological innovation. However, digital financial inclusion hinders the nighttime economy by reducing entrepreneurial activity in the accommodation and catering sectors. (3) Coverage breadth first inhibits, then promotes, and inhibits the nighttime economy in different intervals; the effect of usage depth and digital level on the nighttime economy in intervals shows an increasing trend. (4) In the Yangtze River Economic Belt region, digital financial inclusion initially inhibits the nighttime economy but turns into promotion as it develops; after the implementation of the rural revitalization strategy in 2017, digital financial inclusion can more positively and significantly promote the nighttime economy.

Women’s Investment Decision: An Examination of Risk Tolerance and Financial Literacy

“This study investigates the impact of Digital Financial Literacy (DFL), Access to Technology (AT), and Socioeconomic Status (SES) on Financial Decision-Making (FDM). Using a sample of 147 participants, the research employs regression analysis to reveal significant positive relationships between DFL, AT, and SES with FDM. Findings indicate that higher levels of digital financial literacy and improved access to technology enhance individuals' ability to make informed financial decisions. Furthermore, SES is shown to play a crucial role in shaping financial behavior. The study's insights underscore the need for targeted educational initiatives and policies aimed at improving digital financial literacy, particularly among economically disadvantaged populations. This research contributes to the understanding of factors influencing financial decision-making and offers recommendations for stakeholders aiming to foster financial inclusion in an increasingly digital landscape.”

Examining the Impact of Digital Inclusive Finance on Urban and Rural Consumption Patterns: Insights from China Household Finance Survey in 11 Coastal Regions

Examining the Impact of Digital Inclusive Finance on Urban and Rural Consumption Patterns: Insights from China Household Finance Survey in 11 Coastal Regions

UPI's Influence on India's Economic Transformation: Financial Inclusion

The UPI, since its inception in 2016, has revolutionized the financial industry of India. This paper discusses the all-encompassing and deep change brought by the UPI in the areas of economic growth, incorporation of finance, and cashless economy. Digital transactions have become fluent and real-time accessible under the UPI, thus empowering individuals and businesses to easily access previously untapped populations. The digital payments promoted through UPI reduce cash dependency, which controls tax evasion and circulation of black money along with possible operational inefficiencies. The paper focuses on the critical aspect on how the platform has supported economic growth through financing innovation in fintech, drives the expansion of SMEs, and increases overall transparency in transactions. Moreover, UPI has acted as a significant enabler to help the state achieve the government initiatives - Digital India, which helped boost the country's GDP through acceleration of digitalization with improvement in financial inclusion. Despite such a massive success story, the adoption of UPI continues to pose difficulties in rural areas primarily on account of lower degrees of digital literacy and infrastructure. With the prospects that the cross-border transaction will bring in the future, UPI can further establish economic growth. This research article is a reason for mixed feelings - with one hand, the revolutionary impact that UPI has on India's economy, and on the other hand, the challenges that must be overcome for it to reach its fullest potential.

Impact of financial inclusion, financial stability, bank nonperforming loans, inflation, macroeconomic management quality and unemployment on economic growth in Nigeria

PurposeThe study investigates the impact of financial inclusion, financial stability, bank nonperforming loans, inflation, macroeconomic management quality and the unemployment rate on economic growth in Nigeria.Design/methodology/approachThe data are analyzed using the ordinary least squares regression, generalized linear model regression, robust least squares regression and the quantile regression methods. The sample period is from 2007 to 2022.FindingsFinancial inclusion, inflation rate and macroeconomic management quality are significant determinants of economic growth in Nigeria. Bank nonperforming loans, unemployment rate, international trade and climate change have an insignificant effect on economic growth in Nigeria. Also, financial inclusion, inflation rate, financial stability, macroeconomic management quality and the unemployment rate are significant determinants of economic growth in good economic years in Nigeria.Practical implicationsThe well-known catalysts of economic growth, such as financial inclusion and financial stability, are not positive catalysts of economic growth in Nigeria during good economic years. Therefore, it is recommended that policymakers should find the right level of financial inclusion, financial stability and unemployment that stimulate economic growth in Nigeria.Originality/valueThis study examines some determinants of economic growth in Nigeria which have not been examined in the existing literature.

Study of Financial Digitalization for the Sharia Economy

This research discusses the urgency or importance and potential that can be explored from the study of financial digitalization for the sharia economy. Digitalization of sharia economic finance is very important in the digital economic era as an effort to increase public awareness and participation in the sharia financial system, as well as increasing sharia economic growth in Indonesia, where information and communication technology has become the main means of developing the sharia economy. The urgency of studying financial digitalization for the sharia economy lies in the ability of digital technology to increase access to sharia finance and increase public awareness about the importance of the sharia financial system. This research also shows that digitizing Islamic economic finance can help increase financial inclusion, as well as increase people's ability to manage their finances effectively. The method used in this research is a qualitative method, where this research method is supported by secondary data sourced from scientific writings both from journals, digital literature, books and articles published by mass media related to the research topic discussed so that it can then explain what the answer is to the problem formulation in this research. This research shows that the study of financial digitalization for the sharia economy is very important to increase public awareness and participation in the sharia financial system, as well as increasing sharia economic growth in Indonesia

Migration experience and risky financial assets investments of county households: evidence from China

Enhancing the support for inclusive finance in county economies is crucial in achieving the strategic goal of building financial power. Drawing upon the theoretical lens of county-level inclusive financial accessibility, this study examines the effect of the migration experience (ME) of county socialites on their risky financial assets investment (FAI) and the underlying mechanisms. We utilize data sourced from the County Consumption Survey, a nationwide effort by the Department of Sociology of Tsinghua University and the 58 Tongzhen Research Group. Our findings reveal that the ME of county socialites significantly boosts their likelihood of engaging in financial markets. Furthermore, housing inequality factors, such as housing property rights and housing loans, play a moderating role in the impact of individual ME on their FAI. Additionally, the financial concept has a masking effect rather than a mediating effect on the path of the ME affecting FAI. Notably, the promotion effect of ME displays heterogeneity. Specifically, ME has a stronger positive effect on FAI among college-educated groups, members of the Communist Party of China (CPC), and urban hukou residents than on those who have not completed college education, non-CPC members and rural hukou households. In light of these findings, we propose policy recommendations to optimize the distribution of financial services, adjust the housing equality policy, and enhance inclusive financial literacy.

Machine learning, banking, industry, digitalization, innovation

Aim: The application of artificial intelligence (AI) offers an encouraging avenue for developments in the banking industry. Methods: The study adopted a scoping review of methodology to provide a comprehensive overview of relevant research regarding the potential uses and challenges of AI in banking. Consumer expectations have evolved, emphasizing features such as payment gateways, swift transactions, and resilient banking services. Results: Major utilization of the AI in banking industry includes enhanced customer engagement, satisfaction, and relationships, personalized financial guidance, smart digital wallets, regulation compliance and collaborative efforts, forecasting, tracking market trends, decision-making and problem-solving, anti-money laundering and fraud detection, automation of repetitive, large and time-intensive tasks, enhanced cybersecurity, and opportunity for digital financial inclusion. Conclusion: Users encounter challenges involving security issues, privacy concerns, and the complexity of technology in AI-driven banking services. Recommendation: While AI holds a crucial role in the banking industry, successful implementation demands ample allocation and consistent, predictable utilization of AI practices.

Moderating Role of Technology Self-Efficacy on Fintech Usage and Digital Financial Inclusion of Women in Rural Uganda

Digital financial inclusion (DFI) especially among rural women remains a significant challenge in Uganda. Despite the potential benefits of fintech’s, limited technology self-efficacy (TSE) among rural women hampers their effective usage. This study examined how TSE influences the relationship between fintech usage and DFI among these women. Data were gathered via a structured questionnaire from 384 women vendors in Mbale main market, employing an explanatory, quantitative, cross-sectional design. Using hierarchical regression and Hayes PROCESS Macro V 4.0, the study assessed both direct relationships and the moderating effect of TSE. Results indicate that both fintech usage and TSE positively impact DFI, with TSE significantly enhancing the association between fintech usage and DFI. Based on these findings, the study recommends that policymakers support fintech adoption through targeted education programs to improve TSE among rural women. Additionally, user-friendly interfaces and supportive systems are crucial in overcoming technological barriers and boosting confidence. However, limitations include the study’s cross-sectional approach, focus on women vendors in a specific district, and potential social desirability bias. Future research should consider longitudinal studies, cultural aspects of fintech adoption, and mixed-methods data collection to deepen understanding of the variables.

Pengaruh Inklusi Keuangan dan Pengelolaan Keuangan Terhadap Kinerja UMKM di Desa Rengasdengklok Utara

This study aims to analyse the impact of financial inclusion and financial management on SMEs. Financial inclusion refers to SMEs' access to financial services, while financial management encompasses the practices of managing funds and the effective use of capital. The unit of analysis for this research is SMEs in the village of Rengasdengklok Utara, with data collection conducted through the distribution of questionnaires. A sample of 65 respondents was targeted, but data was obtained from 58 respondents, with sampling conducted using purposive sampling technique. The analysis technique used is multiple linear regression analysis, which is a statistical method to determine the relationship between dependent and independent variables. This is because improved financial inclusion and financial management can enhance the overall performance of SMEs; financial inclusion provides financial access to business actors, while effective financial management can optimise the use of funds, thus these two factors can improve SME performance. For future researchers conducting similar studies, it is suggested that the sample size be larger and the data distribution more extensive. Furthermore, it is recommended to investigate variables such as social capital, financial technology, and more, to identify other factors that may influence SME performance..

Pemberdayaan Ekonomi Perempuan Melalui Program Bank BTPN Syariah: Studi Literatur

The aim of this research is to find out whether financial inclusion has an effect on the stability of sharia banking in Indonesia using the Generalized Least Square (GLS) method. To measure the financial stability of Islamic banking, the inclusion variable contains MSMEs and Deposits, while the stability variable used is NPF. The research method used in this research is quantitative descriptive with the help of the Generalized Least Square (GLS) method which corrects problems in the classical assumption test, which is tested based on Eviews 12 with panel time series data. The research results show that the independent variable MSMEs has a significant effect on NPF. The independent variable Deposits has a significant effect on NPF. Reliability UI results using the F test for the MSME and Deposit variables together have an effect on NPF.

Digital inclusive finance and digital transformation of Chinese enterprises: Perspectives on company technology intensity and financialization

AbstractThis study explores the role of digital inclusive finance in company digital transformation within China, particularly examining the variances among companies with differing levels of technological intensity and financialization. Using A‐share Chinese data from 2011 to 2022, we find that regions with superior digital inclusive finance exhibit enhanced corporate digital transformation, regardless of the provincial or municipal level. Subindexes, including the coverage breadth, use depth, and degree of digital inclusive finance, confirm that they are all significantly positively related to digital transformation. These effects are more pronounced in companies with lower technological intensity, and corporate financialization serves as a mediating factor.

The Financial Inclusion Question in Zimbabwe’s Post-COVID -19, New Normal: Implications for Adoption of Financial Technology (FinTech) on Service Providers

Financial inclusion will be accelerated by the technological opportunities for online financial transactions brought forth by the COVID-19 outbreak. As a result, because there were fewer digital financial transactions, the threats to COVID-19 that were present previously are now more substantial. The aim of this article is to assess the dangers, challenges, and opportunities for financial inclusion brought forth by the use of technology by COVID-19. According to the article, the inherent characteristics of financial technology (FinTech) in connection to financial inclusion allow it to reduce the negative economic and social effects of the ongoing COVID-19 situation. Under COVID-19, the introduction of digital financial transactions has sped up corporate operations and cut expense on doing business. As a result, women now have greater access to transactions involving financial technology (FinTech). The growth of digital financial transactions has made contactless and cashless purchases possible throughout the COVID-19 crisis. The expansion of digital financial inclusion makes it easier to swiftly and effectively implement public assistance programs, such as those for epidemic-affected women. Financial inclusion is being boosted by digital finance, which may eventually replace or improve traditional banking institutions. Working from home has undergone a "revolution" in a number of industries during COVID-19, including banking. Businesses should identify the optimal operating model mix for the future and make sure they have the infrastructure to support widespread, mass flexible working. This calls for reevaluating the function and application of corporate real estate. Since the labor force is likely to become more automated at the same time, resilience is essential. Conceptual Framework of this study is based on the financial inclusion and FinTech concepts which are the main variables guiding the study and it is underpinned by the theories of diffusion of innovation and the Financial Intermediation.

Effective financial inclusion and the need to put the horse before the cart: Saving!

The financial inclusion paradigm is increasingly considered a veritable development model. Therefore, we argue that a deeper understanding of it is necessary for enabling policies and strategies that would yield positive development outcomes (successful financial inclusion). We explore this argument by first, defining “effective financial inclusion” along the lines of identifiable population groups that are often financially excluded from mainstream financial services; and second, by hypothesizing that large national savings pools are a crucial prerequisite for effective financial inclusion. Furthermore, we posit that if effective, financial inclusion should enhance economic welfare, thus engendering “successful financial inclusion.” We evaluate these hypotheses by using a battery of econometric techniques, and document robust supportive findings. Moreover, we evolve first-of-its-kind robust definition of financial inclusion and provide unambiguous evidence that would guide governments and other stakeholders on how to leverage financial inclusion, as a development model, more productively. Importantly, we highlight the primacy of large savings pools for effective financial inclusion.

The role of financial inclusion and technological innovation in stimulating environmental sustainability in the European countries: A new perspective based on load capacity factor

Given the alarming level of climate change, policymakers across the globe are seeking strategies to mitigate environmental pollution to achieve sustainable development. In this context, renewable energy and technological advancements have emerged as an effective way to lower pollution and attain sustainable development. This study evaluates the effect of financial inclusion, technological innovation, and renewable energy on the load capacity factor (LCF) in European countries from 2004 to 2018. LCF is considered the most comprehensive indicator of ecological sustainability, combining both the biocapacity factor and ecological footprint. Hence, the present work fills the literature gap by exploring, for the first time, the effect of financial inclusion on the LCF. Applying the advanced Method of Moment Quantile Regression (MMQR), the study demonstrates that technological innovation and economic growth have adverse effects on LCF while renewable energy and financial inclusion promote LCF. The study indicates that technological innovation and economic growth undermine ecological excellence in European nations while green energy and financial inclusion enhance it. Moreover, the findings of the causality analysis reveal a causal association between financial inclusion, renewable energy, and LCF. Our study recommends prioritizing financial inclusion alongside investments in renewable energy to enhance ecological sustainability.

Inklusi Keuangan dan Efektifitas Kebijakan Moneter : Studi Kasus Negara Indonesia dan Malaysia

Financial inclusion, defined as access and use of formal financial products and services by individuals and companies, has become a major focus in Indonesia and Malaysia in recent years. Authorities in both countries have implemented various policies and programs to increase financial inclusion, hoping to provide economic benefits, namely reducing inflation. The aim of this research is to analyze the influence of financial inclusion, exchange rates, interest rates, broad money, and GDP on inflation in Indonesia and Malaysia. The data used in this research is secondary data ranging from the period 2013Q1 to 2022Q4. The analytical method used in this research is the Vector Error Correction Model (VECM). The conclusion of this research states that the financial inclusion variable has a negative influence on inflation in Indonesia with a VD contribution at the end of the period of 29.37%, while in Malaysia Financial Inclusion has a positive influence on inflation with a VD contribution at the end of the period of 11.22% . The exchange rate negatively influences inflation in Indonesia and Malaysia with VD contributions at the end of the period of 1.28% and 3.87% respectively. Interest rates have a negative influence on inflation in Indonesia with a VD contribution at the end of the period of 1.71%, while in Malaysia interest rates have a positive influence on inflation with a VD contribution at the end of the period of 13.19%. Broad Money positively influences inflation in Indonesia and Malaysia with VD contributions at the end of the period of 2.27% and 2.57% respectively. GDP has a positive influence on inflation in Indonesia with a VD contribution at the end of the period of 22.01%, while in Malaysia GDP has a negative influence on inflation with a VD contribution at the end of the period of 45.39%.

A Primary focus on progress of Small Finance Banks in India

Financial inclusion has been the focus of the policies of the Reserve Bank of India since 2005-06. Along with various initiatives of the Government of India, the RBI approved the setting up of differentiated banking namely Payments Bank (PB) and Small Finance Banks (SFB). SFBs are niche banks set up to undertake basic banking activities for the unserved and underprivileged sections of the population. SFBs mainly cater to the sections like small business units, micro and small enterprises, small and marginal farmers, and the unorganized sector. This paper focus on the progress of SFBs in India in terms of the number of banking outlets, regional spread, population spread and growth of business of Small Finance Banks over the years. It was found that since their establishment, over the period of seven years, there has been considerable expansion of SFB branches with a wider regional spread and substantial increase in their volume of business. Towards the end of the study period it was also found that more SFB branches were set up in semi-urban and rural areas. The preliminary examination of SFBs suggests that they are progressing in the right direction as envisaged in the objectives behind setting them up.

Financial Inclusion and Income Distribution Revisited: New Findings

Financial Inclusion and Income Distribution Revisited: New Findings

Financial Inclusion and Environmental Sustainability in Emerging and Developing Countries: Do control of corruption and trade openness matter?

Financial Inclusion and Environmental Sustainability in Emerging and Developing Countries: Do control of corruption and trade openness matter?

How Fintech mitigates credit mismatches to promote green innovation: Evidence from Chinese listed enterprises

The intersection of financial technology (fintech) and sustainable development has gained increasing attention, particularly regarding how fintech can support corporate green innovation. However, the role of fintech in mitigating credit mismatches—a key barrier for enterprises pursuing green initiatives—remains underexplored, especially within the context of Chinese listed enterprises. Addressing this gap, our study utilizes a panel dataset from 2010 to 2021 to investigate the influence of fintech on green innovation and the mediating role of credit mismatches. Through a series of baseline regressions, endogeneity tests, and heterogeneity analyses, we find a significant positive relationship between fintech adoption and green innovation, with credit mismatches serving as a crucial mediator. Moreover, the effects of fintech are most pronounced in eastern China and in industries with lower pollution levels. These findings provide new insights into how fintech can bridge financing gaps, foster green innovation, and promote the transition to a more sustainable economy. Our results carry important implications for policymakers aiming to leverage fintech as a tool for both financial inclusion and environmental sustainability.