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Paper Number
2754
Paper Type
Completed
Description
This study investigates the impact of information and communication technology (ICT) on financial inclusion in a panel of 74 countries for a period of four years i.e., 2011, 2014, 2017, and 2021. We employ panel regression methods to estimate our model. Specifically, we used the fixed effects regression as a preliminary analysis. However, to mitigate the potential endogeneity concern in the model, we utilize the panel instrumental variable (IV) regression as our preferred estimation method. We find a positive and statistically significant impact of ICT index on financial inclusion. As a sensitivity analysis, we split the sample into two sub-groups – high-income and middle-income countries. Our results suggest that ICT is a significant determinant of financial inclusion in the sample countries. Specifically, internet penetration is a robust driver of financial inclusion in middle-income countries. The policymakers, particularly in middle-income countries, should focus on expanding the internet base to achieve higher financial inclusion.
Recommended Citation
Jain, Shivani and Sahu, Jagadish Prasad, "The Impact of ICT on Financial Inclusion: Evidence from Global Sample" (2023). ICIS 2023 Proceedings. 7.
https://aisel.aisnet.org/icis2023/emobilecomm/emobilecomm/7
The Impact of ICT on Financial Inclusion: Evidence from Global Sample
This study investigates the impact of information and communication technology (ICT) on financial inclusion in a panel of 74 countries for a period of four years i.e., 2011, 2014, 2017, and 2021. We employ panel regression methods to estimate our model. Specifically, we used the fixed effects regression as a preliminary analysis. However, to mitigate the potential endogeneity concern in the model, we utilize the panel instrumental variable (IV) regression as our preferred estimation method. We find a positive and statistically significant impact of ICT index on financial inclusion. As a sensitivity analysis, we split the sample into two sub-groups – high-income and middle-income countries. Our results suggest that ICT is a significant determinant of financial inclusion in the sample countries. Specifically, internet penetration is a robust driver of financial inclusion in middle-income countries. The policymakers, particularly in middle-income countries, should focus on expanding the internet base to achieve higher financial inclusion.
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