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1 – 10 of over 4000Clifford Odame, Kingsley Opoku Appiah and Prince Gyimah
This paper examines the nexus between financial inclusion and the economic growth of an emerging market.
Abstract
Purpose
This paper examines the nexus between financial inclusion and the economic growth of an emerging market.
Design/methodology/approach
We use dataset from the World Bank and Heritage Foundations over the period 2005–2016 and fully modified least squares (FMOLS) and dynamic OLS (DOLS) to examine the financial inclusion–economic growth nexus in Ghana.
Findings
We document a negative relationship between financial inclusion and economic growth, and the causal nexus is unidirectional from financial access to GDP. Financial penetration, however, causes GDP growth, and GDP growth also causes financial penetration. We also document that IT infrastructure, the depth of financial services, employment and inflation drive economic growth in an emerging market.
Practical implications
The findings support international calls to prioritize financial penetration policies geared toward greater economic growth.
Originality/value
The paper adds to extant literature by highlighting new empirical insights on the financial inclusion–economic growth nexus from a sub-Saharan Africa market perspective.
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Nazish Malak and Ameena Arshad
The aim of this study is to explore how financial inclusion can impact healthcare access in developing countries using panel data for the period 2004–2022.
Abstract
Purpose
The aim of this study is to explore how financial inclusion can impact healthcare access in developing countries using panel data for the period 2004–2022.
Design/methodology/approach
To check the impact of financial inclusion on healthcare access, the estimation techniques used are the fixed-effect model (FEM), two-stage least squares (2SLS) and the system generalized method of moments (GMM). The data were collected from different websites such as the World Development Indicators (WDI), the United Nations International Children's Emergency Fund (UNICEF) and the United Nations Educational, Scientific and Cultural Organization (UNESCO).
Findings
It is found in the study that financial inclusion has a significant positive effect on healthcare access, and it is also confirmed from previous literature results. The study found that if there are high financial services in the countries, healthcare sectors can be improved by timely facilities, care and funds. Proper development of financial services could be possible by conducting awareness initiatives, financial planning and implementing literacy programs to educate individuals, particularly in rural and underdeveloped areas. According to the results, trade openness and foreign direct investment have a positive impact on healthcare access, while urbanization has negatively influenced healthcare access.
Research limitations/implications
The limitations of this study were restricted to only 29 developing countries. The main reason behind the lack of availability of data insurance data for developing countries was the limitation in generalizing the results.
Practical implications
The government and policymakers must check what are the best financial inclusion programs and policies that can be implemented to improve healthcare access. Previous literature does not show visibly the impact of financial inclusion’s dimensions on healthcare access.
Originality/value
This study presents a pioneering examination of financial inclusion and healthcare in 29 lower- and middle-income countries (developing countries). This study has used a comprehensive financial inclusion index of 29 developing countries to cover the overall impact of financial inclusion on healthcare in these countries.
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Deposit insurance activities aimed at achieving financial stability and depositor protection often align with financial inclusion programmes of other financial safety-net…
Abstract
Purpose
Deposit insurance activities aimed at achieving financial stability and depositor protection often align with financial inclusion programmes of other financial safety-net participants. However, there is limited empirical evidence in the literature on the role of deposit insurance (DIS) in financial inclusion. This study bridges this gap by analysing data from 143 countries to assess the impact of DIS on financial inclusion along the dimensions of access and usage.
Design/methodology/approach
This study uses the random effect and the generalized methods of moments (GMM) regression models to estimate the effects of deposit insurance on financial inclusion.
Findings
Our results show that, in addition to positive impacts from other policy drivers such as income per capita, economic growth and banking and financial sector development, the practice of an explicit deposit insurance system (EDIS) significantly promotes financial inclusion. However, merely having any form of DIS, as proxied by IADI membership, shows limited potential. Based on the data-informed reliability of our findings, we recommend that countries aiming to deepen financial inclusion should consider adopting or intensifying the practice of EDIS alongside existing programmes.
Originality/value
There is limited or scanty empirical evidence in the literature, if there exists any, that indicates that financial inclusion progress actually benefits from deposit insurance. This study therefore contributes to the literature by providing an empircal evidence on the positive impact of deposit insurance on financial inclusion.
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Muhammed Ashiq Villanthenkodath and Shreya Pal
Financial inclusion is acknowledged as a critical facilitator of the United Nations Sustainable Development Goals agenda for 2030. Therefore, this study aims to examine the…
Abstract
Purpose
Financial inclusion is acknowledged as a critical facilitator of the United Nations Sustainable Development Goals agenda for 2030. Therefore, this study aims to examine the asymmetric role of overall globalization on financial inclusion by controlling economic growth, urbanization and population for the selected South Asian countries.
Design/methodology/approach
Applying the nonlinear autoregressive distributed lag approach to cointegration explores the impact of overall globalization on financial inclusion in the presence of additional variables like economic growth, urbanization and population in the designed financial inclusion function.
Findings
The estimated econometric outcomes show that increasing overall globalization fosters financial inclusion while decreasing overall globalization reduces financial inclusion. Furthermore, a positive (negative) change in economic growth leads to an increase (decrease) in financial inclusion while varying short-run findings. Moreover, both positive and negative changes increase financial inclusion in the long run in connection with urbanization. Although the short-run results are not significant, the study finds that an increase (decrease) in population leads to a decrease (increase) in financial inclusion. Finally, to support the promotion of financial inclusivity throughout South Asia, several policies pertaining to financial inclusion are suggested.
Originality/value
To the best of the authors’ knowledge, this is the first study to examine the asymmetries related to overall globalization on financial inclusion by controlling economic growth, urbanization and population.
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Jeleta Gezahegne Kebede, Saroja Selvanathan and Athula Naranpanawa
The purposes of the paper are as follows: (1) Analysing the effect of financial inclusion on financial stability. (2) Examining whether financial inclusion non-linearily impacts…
Abstract
Purpose
The purposes of the paper are as follows: (1) Analysing the effect of financial inclusion on financial stability. (2) Examining whether financial inclusion non-linearily impacts financial stability. (3) Analysing whether the effect of financial inclusion varies across quantiles of financial stability. (4) Investigating whether dimensions of financial inclusion affect financial stability differently. (5) Examining whether the effect of financial inclusion on financial stability depends on competitiveness of the banking industry.
Design/methodology/approach
Using panel data for 19 African countries for the period 2006–2022, we first developed multidimensional index of financial inclusion using two-stage indexing approach. Then employing panel semiparametric regression, we analyse the non-linear nexus between financial stability and financial inclusion. We further employ panel quantile regression to investigate the differential effect of financial inclusion at different quantiles of financial stability. We also employed two-stage least squires, and alternative measurement of financial stability as robustness checks.
Findings
Employing panel semiparametric regression, we demonstrate that the financial inclusion-stability nexus exhibits non-linearity: below (above) threshold level financial inclusion promotes (reduces) financial stability. Employing panel quantile regression, we find that the effect of financial inclusion increases at higher quantiles of financial stability. We further demonstrate that the effect of financial inclusion on financial stability is pronounced in a more competitive bank industry. The findings are robust to two-stage least squares estimation, and alternative measurement of financial stability. The results suggest that keeping a balance between achieving stable and inclusive financial system, and ensuring a competitive banking industry are essential to achieve bank soundness while promoting financial inclusion.
Originality/value
The study incrementally contributes to the literature related to the financial inclusion – stability nexus in four-fold. First, unlike studies that relied on some indicators of financial inclusion, we employed the effect of multidimensional financial inclusion on financial stability and further examined whether or not the effect varies across financial inclusion dimensions. Second, unlike studies that assumed a linear nexus between financial inclusion and stability, employing panel semiparametric regression, we investigated for non-linear relationship between the two. Employing a novel panel quantile estimation approach, we further scrutinised whether the effect of financial inclusion varies across quantiles of financial stability. Third, to our knowledge, our study is the first to examine the effect of multidimensional financial inclusion on bank soundness in Africa.
Highlights
We find a non-linear nexus between financial inclusion and financial stability.
Financial inclusion below (above) threshold enhances (reduces) financial stability.
The effect of financial inclusion is pronounced at higher quantiles of financial stability.
The effect of financial inclusion on financial stability depends on bank competition.
The results hold across different dimensions of financial inclusion.
We find a non-linear nexus between financial inclusion and financial stability.
Financial inclusion below (above) threshold enhances (reduces) financial stability.
The effect of financial inclusion is pronounced at higher quantiles of financial stability.
The effect of financial inclusion on financial stability depends on bank competition.
The results hold across different dimensions of financial inclusion.
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Josephine Ofosu-Mensah Ababio, Eric Boachie Yiadom, Daniel Ofori-Sasu and Emmanuel Sarpong–Kumankoma
This study aims to explore how institutional quality links digital financial inclusion to inclusive development in lower-middle-income countries, considering heterogeneities.
Abstract
Purpose
This study aims to explore how institutional quality links digital financial inclusion to inclusive development in lower-middle-income countries, considering heterogeneities.
Design/methodology/approach
The study uses dynamic generalized method of moments to analyze a balanced panel data set of 48 lower-middle- income countries (LMICs) from 2004 to 2022, sourced from various databases. It assesses four variables and conducts checks for study robustness.
Findings
The study reveals a positive link between digital financial inclusion and inclusive development in LMICs, confirming theoretical predictions. Empirically, nations with quality institutions exhibit greater financial and developmental inclusion than those with weak institutions, emphasizing the substantial positive impact of institutional quality on the connection between digital financial inclusion and inclusive development in LMICs. For instance, the interaction effect reveals a substantial increase of 0.123 in inclusive development for every unit increase in digital financial inclusion in the presence of strong institutions. The findings provide robust empirical evidence that the presence of quality institutions is a key catalyst for the benefits of digital finance in inclusive development.
Originality/value
This study offers significant insights into digital financial inclusion and inclusive development in LMICs. It confirms a positive relationship between digital financial inclusion and inclusive development, highlighting the pivotal role of institutional quality in amplifying these benefits. Strong institutions benefit deprived individuals, families, communities and businesses, enabling full access to digital financial inclusion benefits. This facilitates engagement in development processes, aiding LMICs in achieving Sustainable Development Goals.
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Lee-Chea Hiew, Meng-Tuck Lam and Swee-Jack Ho
This study aims to examine the impact of perceived benefits-risk dynamics on financial inclusion, the factor driving fintech adoption, the mediating effects of financial inclusion…
Abstract
Purpose
This study aims to examine the impact of perceived benefits-risk dynamics on financial inclusion, the factor driving fintech adoption, the mediating effects of financial inclusion on perceived benefit-risk dynamics and fintech adoption, and the societal sustainability effects of fintech adoption.
Design/methodology/approach
This study used a quantitative study with 258 respondents in Sarawak, Malaysia. PLS-SEM was used to investigate the associations.
Findings
This study suggests that only non-monetary benefits and regulatory risks significantly influence financial inclusion. In addition, financial inclusion acts as an intermediary for non-monetary benefits and regulatory risks. Besides, a direct relationship exists between financial inclusion and fintech adoption, as well as between fintech adoption and societal sustainability.
Research limitations/implications
This model explores a few benefits and risks. Also, technological and legislative changes may alter research outcomes. Besides, this study only samples Sarawak, Malaysia. Therefore, country-specific factors, including technology infrastructure, financial services accessibility and cultural variations, may affect participant responses. This study offers a novel perspective on fintech by including Valence, Public Good and Sustainable Information Society theories.
Practical implications
Financial inclusion’s non-monetary benefits must be emphasised to remove barriers and meet user requirements. Fintech firms should also work with authorities to comply with regulations and help marginalised populations by prioritising sustainability.
Social implications
Fintech growth requires innovation, consumer protection and fair competition. Fintech firms can enhance financial inclusion to address inequalities (SDG10). Governments and fintech solutions should incorporate financial and digital literacy into education (SGG4).
Originality/value
Financial inclusion, fintech adoption and societal sustainability are examined using emotional, sociological and societal sustainability aspects.
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Imène Berguiga and Philippe Adair
Youths aged 15–34 make half the population of Middle East and North Africa (MENA) and over one quarter of the labour force. The purpose of this paper is to address the two…
Abstract
Purpose
Youths aged 15–34 make half the population of Middle East and North Africa (MENA) and over one quarter of the labour force. The purpose of this paper is to address the two following questions. Why youths from Egypt, Jordan and Tunisia lack financial inclusion before (2014 and 2017) and during (2021) the COVID-19 pandemic? What are the determinants of their financial inclusion?
Design/methodology/approach
Financial inclusion encapsulates account holding at financial institutions and the use of digital services they provide. Two probit regressions address financial inclusion regarding these two dimensions, upon three pooled samples selected from the Global Findex Database, each sample gathering roughly 3,000 households including over two-fifths of youths.
Findings
Five results regarding financial inclusion highlight the role of job-status, income, education, gender and age. Prior the pandemic, financial inclusion of young entrepreneurs is affected by (female) gender, (middle) income, (low) education level and country policy. During the pandemic, y women became more financially included; there was no age gap regarding digital services; and despite improvement, digital services remain unsuitable for poorly educated youth. Gender has no effect on the financial inclusion of young employees before and during the pandemic.
Research limitations/implications
Government policy should target youth underserved population to foster financial inclusion, distinguishing voluntary from involuntary reasons of financial exclusion.
Originality/value
To the best of the authors’ knowledge, no paper has addressed yet the determinants of youth financial inclusion, especially the use of digital services, with a focus on job status (entrepreneurs vs employees) in MENA countries, prior and during the pandemic.
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Binh Nguyen The, Tran Thi Kim Oanh, Quoc Dinh Le and Thi Hong Ha Nguyen
This article aims to study the nonlinear effect of financial inclusion on tax revenue of 21 low financial development countries (LFDCs) and 22 high financial development countries…
Abstract
Purpose
This article aims to study the nonlinear effect of financial inclusion on tax revenue of 21 low financial development countries (LFDCs) and 22 high financial development countries (HFDCs) from 2004 to 2020.
Design/methodology/approach
The study calculates the world average financial development index (
Findings
Using the Bayesian method, the results show that financial inclusion negatively impacts tax revenue with an absolute probability of 100% in LFDCs and a lower probability of 92.45% in HFDCs. Additionally, the financial inclusion threshold at LFDCs is 18.90. Below this threshold, financial inclusion promotes tax revenue with a 100% probability. On the contrary, when financial inclusion exceeds the threshold, it will have a negative effect on tax revenue. Similarly, the financial inclusion threshold at HFDCs is 20.14, with a probability of 92.45%.
Originality/value
To the best of the authors’ knowledge, this is the first paper to examine the nonlinear impact of financial inclusion on tax revenue in high and low financial development countries.
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Urvashi Suryavanshi, Rishi Chaudhry, Meenal Arora and Amit Mittal
The purpose of this paper is to analyze the existing literature in the domain of financial inclusion and emphasizing forthcoming trends. It examines recent literature while…
Abstract
Purpose
The purpose of this paper is to analyze the existing literature in the domain of financial inclusion and emphasizing forthcoming trends. It examines recent literature while assessing the geographical distribution, identifying well-known authors, publications, journals and keyword occurrences.
Design/methodology/approach
Based on a scientific search technique, bibliometric analysis in the field of financial inclusion was carried out on a sample of 2,125 Scopus documents for the years 2004–2022. A VOS viewer was used in the study as a tool for performance evaluation and analysis of the science mapping.
Findings
The bibliometric analysis illustrates that India and the USA are dominating in financial inclusion field with significant contributions. The most well-known authors were Ghosh, S. and Munene, J.C. and International Journal of Social Economics was considered as the best journal. Finally, six prominent clusters were identified through keyword analysis. The major themes revolve around digitalization, economic development, demographic and geographic factors and financial literacy.
Practical implications
The research helps in providing information for formulating financial inclusion policies for RBI and Government of India. A comprehensive literature assessment is useful for future scholars to develop a solid conceptual framework. This research would help practitioners to formulate strategies for rural population to enhance their earnings, investments and money.
Originality/value
This study can supply data to describe the framework of earlier financial inclusion studies and provides potential directions for future research.
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