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Kanga, Désiré, Oughton, Christine, Harris, Laurence and Murinde, Victor (2022) 'The diffusion of fintech, financial inclusion and income per capita.' European Journal of Finance, 28 (1). pp. 108-136.

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Advances in information and communication technology (ICT) have provided a platform for the introduction and diffusion of a range of financial technologies that have transformed the financial sector. This study analyses the diffusion of financial technology (fintech) and its interaction with financial inclusion and living standards (GDP per capita). We consider the determinants and effects of technology diffusion in financial services and identify two possible transmission mechanisms from the financial sector to GDP per capita – a fintech diffusion channel and a financial inclusion channel. We specify the interactions between these two channels and their relationship with income per capita. Our empirical analysis focuses on the diffusion of two enabling fintech innovations: ATMs and associated digital networks; and mobile phones and payments systems. The relationships between fintech diffusion, financial inclusion and GDP per capita are estimated using a panel data set for up to 137 countries over the period 1991–2015 using both cross section and panel techniques, including an error correction model that distinguishes short- and long-run effects. A key finding is that fintech diffusion and financial inclusion have long-run effects on GDP per capita over and above their short-run impact and the effects of investment in fixed and human capital.

Item Type: Journal Article
SOAS Departments & Centres: Departments and Subunits > School of Finance & Management
ISSN: 1351847X
Copyright Statement: © 2021 The Author(s). This is an Open Access article distributed under the terms of the Creative Commons Attribution-NonCommercial-NoDerivatives License (http://creativecommons. org/licenses/by-nc-nd/4.0/), which permits non-commercial re-use, distribution, and reproduction in any medium, provided the original work is properly cited, and is not altered, transformed, or built upon in any way
DOI (Digital Object Identifier):
Date Deposited: 08 Jun 2021 15:38
Funders: Economic and Social Research Council

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