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Equality in the digital age: leveraging technological innovation for fostering access to financial services

Author

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  • Muhammad Suhrab

    (Huazhong University of Science and Technology (HUST))

  • Chen Pinglu

    (Huazhong University of Science and Technology (HUST))

  • Ningyu Qian

    (Huazhong University of Science and Technology)

Abstract

The growing inequality in availability of financial services presents a significant obstacle to achieving inclusive economic development, particularly in the BRICS countries. This addresses the urgent need to explore how the technology innovation and diffusion can bridge these gaps by enhancing access to both traditional and digital financial services, offering a way to reduce financial disparities and encourage economic equity. Using robust statistical models like fixed effects regression and feasible generalized least squares (FGLS). The study demonstrates significant and positive relationship between technology diffusion and the access of both traditional and digital financial services. However, the magnitude of this effect varies between the two dimensions, with digital financial services being more adaptable to technological innovation than traditional financial services. Similarly technological innovation have significant positive effect on access to financial services. Although technology is important for improving access to financial services, the research indicates other economic factors such as inflation, trade, and GDP influence access to financial services. From a theoretical perspective, the study highlights how technological innovation enhancing financial inclusion by decreasing inequalities in financial service accessibility. Through integrating technology into financial systems, countries can bridge the gap promoting more equal economic opportunities. Policy makers need to focus on development and implementation strategies that encourage technological innovation in the financial industry. This involves starting initiatives that support the adoption of digital finance and enhance the availability of financial services, especially for underserved communities. Graphical abstract

Suggested Citation

  • Muhammad Suhrab & Chen Pinglu & Ningyu Qian, 2024. "Equality in the digital age: leveraging technological innovation for fostering access to financial services," SN Business & Economics, Springer, vol. 4(12), pages 1-35, December.
    • Handle: RePEc:spr:snbeco:v:4:y:2024:i:12:d:10.1007_s43546-024-00763-x
    DOI: 10.1007/s43546-024-00763-x
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    More about this item

    Keywords

    Technology diffusion; Digital financial services; Traditional financial services; Technological innovation; Financial inclusion;
    All these keywords.

    JEL classification:

    • N94 - Economic History - - Regional and Urban History - - - Europe: 1913-
    • H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • H1 - Public Economics - - Structure and Scope of Government
    • D33 - Microeconomics - - Distribution - - - Factor Income Distribution

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