Fintech, Credit Constraints, and Educational Intergenerational Mobility: Evidence from Cameroon

Can fintech alleviate households' credit constraints to promote educational intergenerational mobility (IM)? Using 12,372 parent–child pairs from Cameroonian Household Surveys (ECAM 2007 and 2014), this chapter assesses the impact of credit constraints on educational IM, while examining the role of fintech early after the introduction of this innovation in Cameroon. Employing mediation analysis, counterfactual simulations, and instrumental variable techniques, we find four main results: First, eliminating credit constraints in Cameroon would increase upward mobility by 6% and reduce downward mobility by 3%. Second, children who potentially benefited from fintech during primary school are 35% more likely to experience upward mobility and 10% less likely to experience downward mobility. Third, up to 25% of this effect is mediated through reduced (3–52%) credit constraints. Finally, the benefits of fintech vary by gender, household structure, region, and parental education, with daughters and children in low-IM regions benefiting less. Our findings underscore the potential of fintech to support equal educational opportunities in low-income contexts, while highlighting the need for complementary gender-sensitive and regionally targeted policies.