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Determinants of financial inclusion: a panel data analysis of global trends, digital finance and policy implications

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  • Ece Kozol

    (Istanbul University, Faculty of Political Sciences)

Abstract

This study examines the determinants of financial inclusion across countries using fixed effects panel regression with World Bank Global Findex data, covering 6 regions. The findings reveal that higher digital payments usage is associated with increased financial inclusion, while inactive financial accounts negatively impact financial awareness, suggesting that financial access alone is insufficient without active engagement. Higher education levels and GDP per capita are positively associated with financial inclusion, underscoring the role of economic development and formal education. Additionally, macroeconomic stability and strong regulatory frameworks contribute to improved financial inclusion, whereas inflation negatively affects financial inclusion. Significant regional disparities persist, with Europe & Central Asia and East Asia & Pacific exhibiting high financial inclusion, while Latin America, South Asia, and Sub-Saharan Africa remain financially underserved. These findings emphasize the need for targeted financial education programs, digital financial inclusion initiatives, and regulatory interventions to enhance financial inclusion globally.

Suggested Citation

  • Ece Kozol, 2026. "Determinants of financial inclusion: a panel data analysis of global trends, digital finance and policy implications," Digital Finance, Springer, vol. 8(1), pages 1-30, March.
    • Handle: RePEc:spr:digfin:v:8:y:2026:i:1:d:10.1007_s42521-025-00170-3
    DOI: 10.1007/s42521-025-00170-3
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