Bringing the underground economy into the official economy through financial channels

This article explores financial mechanisms as a strategic tool for integrating the underground economy intothe formal economic system. The informal or shadow economy, although frequently viewed negatively, constitutes asubstantial portion of economic activity particularly in developing countries. Integrating these unregulated sectors viafinancial instruments such as digital banking, tax incentives, mobile payment platforms, and inclusive financial regulationscan enhance national productivity, increase tax revenue, and promote financial stability. The study examines internationalbest practices and innovative policy approaches to bringing unregistered economic actors into the formal financiallandscape.