Acceso usuarios
, Oladipo Olalekan David
Objective: The objective of this study is to investigate state-dependency in the nexus between digital financial inclusion and economic growth in sub-Saharan Africa, with the aim of examining the impact of adopting digital financial technology to reduce financial exclusion and contribute to economic growth.
Theoretical Framework: The paper extends the work of Sarma (2008) and Khera et al. (2021), by creating a new financial inclusion index that captures both traditional and digital financial inclusion.
Method: The methodology adopted for this research comprises the principal component analysis (PCA) to identify signals in financial inclusion indicators, thereafter financial inclusion indexes for digital and traditional financial services were constructed. The panel quantile regression methodology was employed to analyse the impact of shocks and determine state dependency in the nexus, respectively. Data collection was carried out through secondary sources.
Results and Discussion: The result confirms a positive relationship between digital financial inclusion and economic growth with the greatest impact in countries with lower real GDP, confirming state dependency.
Research Implications: The findings suggest that policymakers should focus on promoting digital financial inclusion, particularly in countries with low to intermediate levels of income.
Originality/Value: This study contributes to the literature by broadening the definition of digital financial inclusion beyond what is currently found in the literature to include vital financial inclusion dimensions such as access to financial services. The relevance and value of this research are further evidenced by the consideration of state-dependency in the relationship between financial inclusion and growth.
