IDEAS home Printed from https://ideas.repec.org/a/spr/soinre/v178y2025i3d10.1007_s11205-024-03380-1.html
   My bibliography  Save this article

Exploring the Impact of Artificial Intelligence on Financial Inclusion: Cross-Country Analysis

Author

Listed:
  • Yogeeswari Subramaniam

    (Universiti Teknologi Malaysia)

  • Nanthakumar Loganathan

    (Universiti Teknologi Malaysia)

  • Fatin Nur Hidayah Taib Khan

    (Universiti Malaysia Sarawak)

  • Thirunaukarasu Subramaniam

    (Universiti Malaya)

Abstract

This study uses panel data from 29 countries that were categorised from low to high in terms of AI adoption from 2017 to 2021 to investigate the impact of artificial intelligence on financial inclusion. The study employed both static and dynamic Generalized Method of Moments (GMM) panel data estimations to achieve the research objective. The findings show that artificial intelligence is a statistically significant determinant of financial inclusion and helps promote financial inclusion in countries that adopt artificial intelligence. Besides that, robustness analysis conducted for alternative measures of AI, and the results continue to demonstrate that AI contributes to financial inclusion by addressing some of the issues that have historically made it difficult for some groups to receive financial services. As a result, significant expansion, and the deployment of artificial intelligence in the finance sector are required to overcome existing financial exclusion and promote financial inclusion. and solve the existing financial exclusion issues.

Suggested Citation

  • Yogeeswari Subramaniam & Nanthakumar Loganathan & Fatin Nur Hidayah Taib Khan & Thirunaukarasu Subramaniam, 2025. "Exploring the Impact of Artificial Intelligence on Financial Inclusion: Cross-Country Analysis," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 178(3), pages 1227-1244, July.
    • Handle: RePEc:spr:soinre:v:178:y:2025:i:3:d:10.1007_s11205-024-03380-1
    DOI: 10.1007/s11205-024-03380-1
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11205-024-03380-1
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s11205-024-03380-1?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Vanessa S. Tchamyou & Simplice A. Asongu, 2017. "Information Sharing and Financial Sector Development in Africa," Journal of African Business, Taylor & Francis Journals, vol. 18(1), pages 24-49, January.
    2. Tough Chinoda & Farai Kwenda, 2019. "Do mobile phones, economic growth, bank competition and stability matter for financial inclusion in Africa?," Cogent Economics & Finance, Taylor & Francis Journals, vol. 7(1), pages 1622180-162, January.
    3. Sanderson Abel & Learnmore Mutandwa & Pierre Le Roux, 2018. "A Review of Determinants of Financial Inclusion," International Journal of Economics and Financial Issues, Econjournals, vol. 8(3), pages 1-8.
    4. Ndanshau, Michal O.A. & Njau, Frank E., 2021. "Empirical Investigation into Demand-Side Determinants of Financial Inclusion in Tanzania," African Journal of Economic Review, African Journal of Economic Review, vol. 9(01), January.
    5. Robina Badar & Sofia Anwar & Syed Asif Ali Naqvi, 2020. "Financial Inclusion and Determinants in South Asian Countries," Journal of Accounting and Finance in Emerging Economies, CSRC Publishing, Center for Sustainability Research and Consultancy Pakistan, vol. 6(2), pages 623-633, June.
    6. Abdoulganiour Almame Tinta & Idrissa Mohamed Ouédraogo & Ramatu Mahama Al‐Hassan, 2022. "The micro determinants of financial inclusion and financial resilience in Africa," African Development Review, African Development Bank, vol. 34(2), pages 293-306, June.
    7. David Roodman, 2009. "How to do xtabond2: An introduction to difference and system GMM in Stata," Stata Journal, StataCorp LLC, vol. 9(1), pages 86-136, March.
    8. Mose Naftaly & Thomi John, 2021. "The Determinants of Financial Inclusion," Financial Internet Quarterly (formerly e-Finanse), Sciendo, vol. 17(2), pages 51-58, June.
    9. Peter W. Muriu, 2021. "Does the Quality of Institutions Matter for Financial Inclusion? Cross Country Evidence," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 13(7), pages 1-27, June.
    10. Tang, Chor Foon & Abosedra, Salah, 2014. "The impacts of tourism, energy consumption and political instability on economic growth in the MENA countries," Energy Policy, Elsevier, vol. 68(C), pages 458-464.
    11. Arellano, Manuel & Bover, Olympia, 1995. "Another look at the instrumental variable estimation of error-components models," Journal of Econometrics, Elsevier, vol. 68(1), pages 29-51, July.
    12. Vanessa S. Tchamyou, 2019. "The Role of Information Sharing in Modulating the Effect of Financial Access on Inequality," Journal of African Business, Taylor & Francis Journals, vol. 20(3), pages 317-338, July.
    13. Yaya Koloma, 2021. "Financial inclusion and entrepreneurship willingness of youth: Evidence from Mali," African Development Review, African Development Bank, vol. 33(2), pages 263-275, June.
    14. Peterson K. Ozili, 2018. "Impact of digital finance on financial inclusion and stability," Borsa Istanbul Review, Research and Business Development Department, Borsa Istanbul, vol. 18(4), pages 329-340, December.
    15. Workineh Ayenew Mossie, 2022. "Understanding financial inclusion in Ethiopia," Cogent Economics & Finance, Taylor & Francis Journals, vol. 10(1), pages 2071385-207, December.
    16. Blundell, Richard & Bond, Stephen, 1998. "Initial conditions and moment restrictions in dynamic panel data models," Journal of Econometrics, Elsevier, vol. 87(1), pages 115-143, August.
    17. Hermann Hegueu Ndoya & Charly Ondobo Tsala, 2021. "What drive gender gap in financial inclusion? Evidence from Cameroon," African Development Review, African Development Bank, vol. 33(4), pages 674-687, December.
    18. Nir Kshetri, 2021. "The Role of Artificial Intelligence in Promoting Financial Inclusion in Developing Countries," Journal of Global Information Technology Management, Taylor & Francis Journals, vol. 24(1), pages 1-6, January.
    19. Shenali Nupehewa & Sachintha Liyanage & Deshan Polkotuwa & Madhurshi Thiyagarajah & Ruwan Jayathilaka & Anuja Lokeshwara, 2022. "More than just investment: Causality analysis between foreign direct investment and economic growth," PLOS ONE, Public Library of Science, vol. 17(11), pages 1-28, November.
    20. Ozili, Peterson Kitakogelu, 2018. "Impact of Digital Finance on Financial Inclusion and Stability," MPRA Paper 84771, University Library of Munich, Germany.
    21. Anthony Amoah & Kofi Korle & Rexford Kweku Asiama, 2020. "Mobile money as a financial inclusion instrument: what are the determinants?," International Journal of Social Economics, Emerald Group Publishing Limited, vol. 47(10), pages 1283-1297, August.
    22. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 58(2), pages 277-297.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Simplice A. Asongu & Nicholas M. Odhiambo, 2021. "Income Levels, Governance and Inclusive Human Development in Sub-Saharan Africa," Applied Research in Quality of Life, Springer;International Society for Quality-of-Life Studies, vol. 16(1), pages 71-103, February.
    2. Samuel cédric Nkot & Sezard Timbi, 2023. "Governance and financial development: does financial openness matter? Evidence from Sub-Saharan African countries," Economics Bulletin, AccessEcon, vol. 43(1), pages 471-483.
    3. Efobi, Uchenna & Asongu, Simplice & Okafor, Chinelo & Tchamyou, Vanessa & Tanankem, Belmondo, 2019. "Remittances, finance and industrialisation in Africa," Journal of Multinational Financial Management, Elsevier, vol. 49(C), pages 54-66.
    4. Simplice Asongu & Rexon Nting, 2021. "The role of finance in inclusive human development in Africa revisited," Journal of Economic and Administrative Sciences, Emerald Group Publishing Limited, vol. 38(2), pages 345-370, February.
    5. Asongu, Simplice A. & Le Roux, Sara & Singh, Pritam, 2021. "Fighting terrorism in Africa: Complementarity between inclusive development, military expenditure and political stability," Journal of Policy Modeling, Elsevier, vol. 43(5), pages 897-922.
    6. Njangang, Henri & Asongu, Simplice A. & Tadadjeu, Sosson & Nounamo, Yann & Kamguia, Brice, 2022. "Governance in mitigating the effect of oil wealth on wealth inequality: A cross-country analysis of policy thresholds," Resources Policy, Elsevier, vol. 76(C).
    7. Simplice A. Asongu & Nicholas M. Odhiambo, 2023. "Foreign Direct Investment, Information Technology, And Total Factor Productivity Dynamics In Sub‐Saharan Africa," World Affairs, John Wiley & Sons, vol. 186(2), pages 469-506, June.
    8. Tadadjeu, Sosson & Njangang, Henri & Asongu, Simplice A. & Kamguia, Brice, 2023. "Natural resources, child mortality and governance quality in African countries," Resources Policy, Elsevier, vol. 83(C).
    9. Simplice A. Asongu & Nicholas M. Odhiambo, 2019. "Governance, capital flight and industrialisation in Africa," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 8(1), pages 1-22, December.
    10. Asongu, Simplice A. & Odhiambo, Nicholas M., 2020. "Foreign direct investment, information technology and economic growth dynamics in Sub-Saharan Africa," Telecommunications Policy, Elsevier, vol. 44(1).
    11. Asongu, Simplice & le Roux, Sara & Nwachukwu, Jacinta & Pyke, Chris, 2018. "The Mobile Phone as an Argument for Good Governance in Sub-Saharan Africa," MPRA Paper 89364, University Library of Munich, Germany.
    12. Simplice A. Asongu & Nicholas M. Odhiambo, 2021. "Information Asymmetry and Insurance in Africa," Journal of African Business, Taylor & Francis Journals, vol. 22(3), pages 394-410, July.
    13. Asongu, Simplice & Odhiambo, Nicholas, 2019. "Foreign Aid Complementarities and Inclusive Human Development in Africa," MPRA Paper 101086, University Library of Munich, Germany.
    14. Simplice A. Asongu & Joseph Nnanna & Paul N. Acha-Anyi, 2020. "On the simultaneous openness hypothesis: FDI, trade and TFP dynamics in Sub-Saharan Africa," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 9(1), pages 1-27, December.
    15. Simplice Asongu & Christelle Meniago & Raufhon Salahodjaev, 2022. "The role of value added across economic sectors in modulating the effects of FDI on TFP and economic growth dynamics," International Journal of Emerging Markets, Emerald Group Publishing Limited, vol. 18(11), pages 5087-5108, February.
    16. Simplice A. Asongu & Sara Le Roux & Pritam Singh, 2020. "Fighting terrorism in Africa: complementarity between inclusive development, military expenditure and political stability," Journal of Africa SEER Centre(ASC) 20/024, Africa SEER Centre(ASC).
    17. Simplice A. Asongu & Paul N. Acha-Anyi, 2020. "Enhancing ICT for productivity in sub-Saharan Africa: Thresholds for complementary policies," African Journal of Science, Technology, Innovation and Development, Taylor & Francis Journals, vol. 12(7), pages 831-845, November.
    18. Simplice A. Asongu Ph.D & Joseph Nnanna, . "Foreign Aid And Sustainable Inclusive Human Development In Africa," Journal of Economic and Sustainable Growth 2, Office Of The Chief Economist, Development Bank of Nigeria.
    19. Khan, Mohammed Arshad & Khan, Muhammad Atif & Khan, Muhammad Asif & Alhumoudi, Hamad & Haddad, Hossam, 2023. "Natural resource rents and access to finance," Journal of Multinational Financial Management, Elsevier, vol. 70.
    20. Jamil, Abd Rahim Md. & Law, Siong Hook & Mohamad Khair-Afham, M.S. & Trinugroho, Irwan, 2023. "Financial inclusion and economic uncertainty in developing countries: The role of digitalisation," Economic Analysis and Policy, Elsevier, vol. 79(C), pages 786-806.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:soinre:v:178:y:2025:i:3:d:10.1007_s11205-024-03380-1. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.