Financial Inclusion Research Articles

Assessing bank financial performance in the context of digital financial service policy: empirical insights

Purpose The Digital Financial Services Policy (DFSP) was initiated by the Ghana Ministry of Finance in 2020, to promote the use of digital financial services by financial institutions to achieve financial inclusion. This study aims to examine the impact of the DFSP on bank financial performance (FP). Design/methodology/approach This study used data from 20 universal banks between 2017 and 2022. The ordinary least square, logistic regressions, heterogeneity analysis and robustness tests were used to examine whether DFSP affect FP. Findings This study finds that DFSP positively impacts return on assets and return on equity. In addition, adopting DFSP in Ghana has levelled the playing field for both large and small banks, as well as for listed, non-listed, domestic and foreign-owned banks, supporting the financial inclusion theory’s benefits associated with banks. However, DFSP negatively impacts the net interest margin. Practical implications As DFSP enhances financial inclusion with improved social ramifications, this highlights the need for Ghanaian universal banks to support digitalization policies, invest in digital infrastructure and develop innovative digital products and services to enhance their performance. Originality/value To the best of the authors’ knowledge, this study provides some of the first empirical evidence on the effect of the DFSP on FP in Ghana.

Improving Financial Inclusion Through Understanding the Credit Preferences of Immigrants

Improving Financial Inclusion Through Understanding the Credit Preferences of Immigrants

Digital Commerce and MSMEs Output in Sub-Saharan Africa

In this paper, we assessed the impact of digital commerce on micro, small and medium enterprises (MSMEs) in sub-Saharan Africa using evidence from Nigeria. In a descriptive research design, we adopted both descriptive and inferential statistics to answer the three research questions and test the corresponding hypotheses. Primary data gleaned from a sample of 400 respondents selected across the six geopolitical zones of Nigeria using multiple sampling techniques was used for the study. Results from logit model regression show that digital commerce has made significant impacts on performance, growth and expansion, as well as cost-effectiveness and profitability of MSMEs in Nigeria. While the study noted that, though litany of challenges still confronts digital commerce in sub-Saharan Africa, we still concluded that any increase in awareness and adoption of digital commercial activities by one unit has an odd ratio of about 10.1, hence, MSMEs output will be 10 times likely improve by the unit increase. To this, we recommended that both government and other relevant stakeholders must partner to ensure that enabling digital environments are created for sustainable digital commerce. This partnership must function well in removing all bottlenecks especially as it concerns infrastructural development, regulations and improved financial inclusion.

CORRELATES OF FINANCIAL INCLUSION AMONG THE RESIDENTS OF BARANGAY AMBIONG LA TRINIDAD BENGUET

Financial inclusion is defined as the availability of financial services to everyone. It is driven by financial literacy and the trust of the users in the financial services provided. Using descriptive research, the study determined the perceived financial literacy of the locality on specific financial services and concepts and the perception of the locality on concepts of financial inclusion. The study also delved into the impact of education, social class and age bracket on the perceived level of financial literacy and the perception of financial inclusion. Results show that the locality has a low perceived financial literacy on the identified financial services but displayed very high positive perception towards financial inclusion. The study also revealed that education, social class and age bracket were not significant factors in the perceived level of financial literacy. The Millennial age bracket also exhibited higher positive perception on financial inclusion compared to the other age groups. In terms of correlation, no established pattern or trend was established in any group. The study pushed for increased efforts in improving financial literacy and better approaches in introducing and offering financial services in order to develop financial inclusion. KEYWORDS: Age Bracket Financial Inclusion, Financial Education, Local Financial Inclusion, Local Financial Literacy, Social Classes

Digital Finance Ecosystems and Their Role in Advancing Financial Inclusion: Opportunities, Risks, and Future Directions

Digital finance ecosystems are revolutionizing the financial landscape by integrating cutting-edge technologies to provide financial services to previously underserved populations. This paper explores the role of these ecosystems in advancing financial inclusion, focusing on opportunities, risks, and future directions. Through real-time data, case studies, and visual analyses, the paper highlights the components of digital finance ecosystems, evaluates their impact on financial inclusion, and proposes strategies for mitigating associated risks. Key insights into partnerships, inclusive finance models, and future trends are also presented.

Financial inclusion through specialization or diversification with group and individual loans in microfinance

Financial inclusion through specialization or diversification with group and individual loans in microfinance

Digital financial inclusion and women: a case study of Pix, the Brazilian instant payment system

Digital financial inclusion and women: a case study of Pix, the Brazilian instant payment system

Formal financial inclusion and digital mobile money adoption in sub-Saharan Africa: do bank concentration and competition matter?

Formal financial inclusion and digital mobile money adoption in sub-Saharan Africa: do bank concentration and competition matter?

The effect of E-commerce on digital inclusive finance: evidence from the E-commerce boom in rural China

The effect of E-commerce on digital inclusive finance: evidence from the E-commerce boom in rural China

The role of Islamic FinTech in digital financial inclusion and sustainable development post covid-19: cross-country analysis

The role of Islamic FinTech in digital financial inclusion and sustainable development post covid-19: cross-country analysis

An Analytical Study of use of UPI Payment Gateways among Post Graduate students in PCMC

— This analytical study investigates the usage patterns, preferences, and perceptions surrounding the adoption of UPI (Unified Payments Interface) payment gateways among postgraduate students. With the rapid proliferation of digital payment solutions in India, understanding the dynamics of UPI adoption among this demographic group is crucial for promoting financial inclusion and driving the transition towards a cashless economy. The study employs a mixed-methods approach, combining quantitative surveys and qualitative interviews to gather comprehensive insights into postgraduate students' experiences with UPI payment gateways. Key findings reveal a high level of awareness and adoption of UPI among postgraduate students, driven by factors such as convenience, security, and accessibility. Certain UPI platforms emerge as preferred choices, influenced by transaction speed, user interface design, and additional features. However, challenges such as security concerns and technical issues persist, warranting targeted interventions to enhance user education and address usability issues. The study underscores the importance of tailored strategies to promote UPI adoption among diverse student populations and highlights the potential of digital payment solutions to drive financial literacy and empower the youth. Recommendations for UPI service providers, educational institutions, and policymakers are provided to optimize the adoption and usage of UPI payment gateways among postgraduate students, contributing to the advancement of India's digital payment ecosystem. Keywords— UPI Payments, Students, Online Payment

An Empirical Analysis of Loan Repayment Behavior and Default Rates on Digital Lending Platforms: Evidence from an Emerging Market

The rapid growth of digital lending platforms has revolutionized access to credit in emerging economies, providing financial opportunities to underserved individuals. Despite these advancements, high loan default rates remain a substantial challenge, threatening the sustainability of these lending platforms and the broader financial ecosystem. This study examines the determinants of loan default among users of mobile-based digital lending platforms in Kenya, a leading adopter of digital financial services. Employing a sample of 161 responses from borrowers, the analysis uses a probit regression model to identify primary predictors of loan default. The study focuses on borrower demographics like age and place of residence and loan characteristics, such as repayment term (period) and interest rates. The results reveal that older customers and those in rural areas are more likely to default on their loans, whereas longer repayment periods reduce the probability of default. Interestingly, the interest rate does not significantly affect default behavior, implying that borrowers prioritize access to credit over its cost. These results underscore the essence of tailoring digital lending practices to the diverse borrower needs and circumstances. By addressing the factors that drive loan defaults, digital platform lenders can improve risk assessment frameworks, enhance financial inclusion, and enhance the sustainability of digital lending platforms. The findings provide actionable insights for policymakers, lenders, and other industry players seeking to mitigate default risks and foster a more robust digital financial ecosystem.

Financial inclusion, entrepreneurial activity and the moderating role of human capital: new cross-country evidence

PurposeThis study aims to reexamine the moderating role of human capital on the effect of extended financial inclusion (FI) for entrepreneurship, using data from the Global Entrepreneurship Monitor for a sample of 42 countries from 2006 to 2017.Design/methodology/approachThis study distinguished between actual and perceived human capital. Actual human capital was measured through formal education while perceived human capital was captured by self-perceived capabilities for business start-ups. The moderating role of human capital was captured by the interaction terms between FI and human capital to investigate how the effects of FI on entrepreneurship vary with levels of human capital. The estimation used the panel-corrected standard error estimators and the two-step system generalized method of moments estimators.FindingsHigher levels of formal education decrease the positive effect of extended FI on entrepreneurial activities. Individuals with high levels of self-capability do not leverage FI for entrepreneurial activities as much as those with lower levels of perceived capability. The results are robust to different estimation methods and different forms of actual human capital.Research limitations/implicationsBoth financial and human capital matter for new business formation worldwide. The findings suggest that FI policies must account for the decreasing effect in response to high levels of human capital. Future research should explore different measures of entrepreneurial performance, various types of entrepreneurship and entrepreneurship across gender groups to gain deeper insights into strategies for promoting entrepreneurship.Practical implicationsEducation strategies should focus on specific types of education, such as entrepreneurship education with financial literacy, rather than traditional academic curriculum, to foster entrepreneurship knowledge, skills and creativity. Likewise, entrepreneurship support schemes should aim to nurture and share appropriate levels of self-efficacy, avoiding excessively high self-efficacy, which is deleterious to the benefits of FI for entrepreneurial activities.Originality/valueThis study offers novel evidence of the decreasing effects of FI on entrepreneurial activities in response to increased actual and perceived human capital.

Pengaruh Literasi Keuangan, Inklusi Keuangan dan Financial Technology Terhadap Prilaku Keuangan pada Mahasiswa Universitas Bina Darma Palembang

This research aims to analyze the influence of Financial Literacy, Financial Inclusion, and Financial Technology on the Financial Behavior of postgraduate students at Bina Darma University. The main problem identified is how these three variables influence students' financial management and how much they contribute to their financial behavior. The method used was a quantitative approach with data analysis using SmartPLS, involving 227 respondents. The research results show that Financial Technology has the most significant influence on Financial Behavior, with a Path Coefficient of 0.337. Financial Literacy also makes a positive contribution with a Path Coefficient of 0.258, while Financial Inclusion has a positive effect but with a smaller contribution, namely a Path Coefficient of 0.157. The R-Square value for Financial Behavior is 0.411, which indicates that the independent variables explain 41% of the variation in student Financial Behavior. The validity and reliability test of the model shows that all variables have good validity and reliability, without multicollinearity problems. This research concludes that Financial Technology and Financial Literacy play a key role in influencing Financial Behavior, while Financial Inclusion has a smaller but still significant impact. Keywords: Financial Literacy, Inclusion, Fintech, Financial Behavior

Adoption of Website Technology as a Business Funding Platform for Student MSMEs: Diffusion of Innovation (DOI) Theory Perspective

This study investigates the adoption of GEMAH, a digital platform connecting investors and micro, small, and medium enterprises (MSMEs) owned by students, using the Diffusion of Innovation (DOI) framework. The findings highlight GEMAH’s advantages in providing efficient and accessible funding tailored to the digital preferences of Gen Z entrepreneurs. However, challenges remain in usability and information clarity, which are critical for first-time users. Trialability fosters user confidence, yet a lack of testimonials and case studies limits trust, and the platform’s early development stage constrains observability. Additionally, regulatory and infrastructural gaps underscore the importance of institutional support from universities and financial authorities like OJK. This study suggests improving GEMAH’s features, enhancing transparency, and fostering user trust through regulatory assurance and collaboration with educational institutions. GEMAH holds potential as a sustainable solution for financial inclusion and the growth of student MSMEs in Indonesia.

Digital Financial Inclusion Through Mobile Finance Innovation in Rural China: Cases from a Multi-level Study at the Base of the Pyramid

Digital Financial Inclusion Through Mobile Finance Innovation in Rural China: Cases from a Multi-level Study at the Base of the Pyramid

An Appraisal of the Impact of Financial Technologies (FinTechs) on Financial Inclusions in Selected Parts of Zambia

Purpose: In recent years, the rise of Financial Technologies (FinTechs) has transformed the landscape of financial services, particularly in terms of expanding access to financial products and services, known as financial inclusion. The study seeks to understand how FinTech innovations contribute to bridging the gap between the banked and unbanked, promoting financial literacy, and fostering a culture of financial empowerment. Methodology: The study employed a mixed methods approach to gather comprehensive insights. A target sample size of 1,200 individuals was carefully selected across six districts—Chongwe, Shibuyunji, Chisamba, Lusaka, and Kafue—encompassing both urban and peri-urban areas. These districts were chosen based on evidenced statistical literacy levels, ensuring participants had sufficient understanding of financial concepts and technology. A total of 722 responses were received, resulting in a 60% response rate. Findings: Results indicate a strong link between the emergence of FinTechs and financial inclusion. FinTech innovations, such as mobile banking, digital payments, and alternative lending platforms, have significantly lowered barriers to accessing financial services for underserved populations, including low-income individuals, small and medium-sized enterprises (SMEs), and those in remote areas. Additionally, FinTech platforms have empowered individuals by promoting financial literacy through user-friendly interfaces and personalized financial management tools. Despite these advancements, challenges persist in ensuring equitable access, particularly for marginalized communities facing digital literacy barriers, infrastructural limitations, and regulatory constraints. Unique Contribution to Theory, Policy and Practice: The study highlights the transformative role of FinTechs in democratizing access to financial services and knowledge, fostering financial empowerment, and narrowing the gap between the banked and unbanked. However, it underscores the need for collaborative efforts among governments, financial institutions, and FinTech companies to address persistent challenges. Recommendations include developing inclusive policies, improving infrastructure, and promoting digital literacy initiatives to ensure that FinTech's potential is fully harnessed in creating a more inclusive and sustainable financial ecosystem

Digital Banking Practices and its Impact on the Competitive Scenario of the Indian Banking Sector

Advancement in technology and digitalization has altered the way economic activities are carried out, and has paved the way for a faster pace of growth across most sectors of the worldwide economy. The Indian Banking Sector (IBS) is no exception to this transition. The IBS has progressed over the years and digital adoption has played a significant role in financial inclusion. Studies have established that adoption of digital practices have impacted operational efficiency and profitability of banks. Bank characteristics are also found to have impacted digital adoption, and have shaped the competitive structure of the country's banking sector. Digital technology has also enabled banks to economize of personnel and branches. In this context, this paper sought to examine the extent of digital adoption in the Indian banking sector and inquire into any structural changes it had led to, over a period of time. The study is exploratory in nature and examined the composition of the IBS in terms of banks leading in the overall digital banking practices. As a measure of depth of digitalization, the study also analyzed and compared the value of digital banking transactions in relation to total assets of the banks. The study also inquired into whether bank ownership type had any implications for adoption digital technology in banking practices. Through these gradations of analysis, the purpose was also to look for indications of the future structural composition of the IBS.

Bridging the Gap: How Academic Institutions Can Foster the Future of Social Entrepreneurship in India

Social entrepreneurship represents a transformative approach to addressing societal challenges by blending innovation with sustainability. With an estimated two million social enterprises, India boasts one of the world's most dynamic social entrepreneurship ecosystems. Social enterprises in the country predominantly focus on seven high-impact sectors: agriculture, clean energy, health, financial inclusion, water and sanitation, and education. Academic institutions in India have a vital role in cultivating socially-conscious leaders capable of driving significant change in these areas. This article delves into the pivotal contributions of Indian academic institutions in fostering social entrepreneurship, emphasizing empathy-driven education, curriculum development, hands-on learning, and strategic collaborations. It also examines existing challenges, including the operational hurdles faced by incubators, the gap in students' understanding of real-world problems, and the disproportionate focus on technology-based solutions, offering actionable recommendations to bridge these divides

Model Green Trade Berbasis Natural Resources terhadap Green Growth di Brazil, Rusia, Indonesia, Singapura, India dan China (BRISIC)

Researchers in this study aim to determine the Natural Resources-Based Green Trade Model for Green Growth in Brazil, Russia, Indonesia, Singapore, India and China (BRISIC). The method in this research is using the ARDL Panel method. The variables used in this research are Green Growth, Green Trade, Natural Resources, Financial Inclusion, Green Innovation, Digital Economy. The results of this research are from the Green Trade Model Based on Natural Resources on Green Growth in Brazil, Russia, Indonesia, Singapore, India and China (BRISIC) using the panel method, it can be concluded that in BRISIC countries the variable that has an overall influence is green trade. and Natural resources both Short Run Equation and Long Run Equation.