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Information Technology for Development

Author ORCID Identifier

Amit Pandey: https://orcid.org/0000-0002-7757-7305

Abstract

This study examines the relationships among digital financial inclusion drivers, financial literacy, institutional support frameworks, and inclusive growth outcomes in India. Despite significant policy efforts to expand digital account ownership through initiatives such as the Pradhan Mantri Jan Dhan Yojana and the Unified Payments Interface, gaps persist in translating access into developmental outcomes. Drawing on the capability approach, institutional theory, and diffusion of innovations theory, the research investigates whether digital access drives inclusive growth or requires complementary mechanisms. Data were collected from 3,120 banked individuals across six Northern Indian states between November 2022 and April 2025 using stratified random sampling. Partial least squares structural equation modelling was used to test the hypothesised relationships. Findings reveal that digital access does not directly influence inclusive growth; rather, financial literacy fully mediates this relationship, explaining the role of technology in capability conversion. Institutional support frameworks independently contribute to inclusive growth, highlighting the importance of policies, programmes, and schemes. The model explains 89.8% of the variance in inclusive growth, with financial literacy as the strongest predictor. These results advance information-technology-for-development theory by demonstrating complementarity between technology, capabilities, and institutions, addressing digital divide debates by emphasising capability formation and institutional support over access alone.

DOI

10.17705/1ITD.032209

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