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Artificial Intelligence and Digital Financial Inclusion

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  • Ozili, Peterson K

Abstract

Artificial intelligence (AI) is rapidly growing with new use cases emerging every day. AI has many applications in the financial sector. It has applications for risk management, fraud detection, efficiency, cost savings and improved customer experience. However, its applications for digital financial inclusion and development finance are yet to be explored in the literature. This study explores how artificial intelligence can be used to increase digital financial inclusion. Specifically, the study explores the potential for AI to streamline the operations of agents of digital financial inclusion; determine the communal areas in need of digital financial inclusion; automate the digital formal account opening process; offer customized experience for both banked and unbanked adults; ensure security and safety of customers’ funds; determine the credit worthiness of unbanked adults who have recently become banked; give banked adults full control of their financial lives; deepen digital financial inclusion; and promote equity and diversity for digital financial inclusion. The study also identifies the challenges of AI for digital financial inclusion. It further presents some insights on the possible AI governance frameworks for digital financial inclusion. The insights offered in this study are useful to guide countries and policymakers that want to use AI to accelerate digital financial inclusion.

Suggested Citation

  • Ozili, Peterson K, 2025. "Artificial Intelligence and Digital Financial Inclusion," MPRA Paper 125033, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:125033
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    File URL: https://mpra.ub.uni-muenchen.de/125033/1/MPRA_paper_125033.pdf
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    References listed on IDEAS

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    1. Ahmad Hassan Ahmad & Christopher Green & Fei Jiang, 2020. "Mobile Money, Financial Inclusion And Development: A Review With Reference To African Experience," Journal of Economic Surveys, Wiley Blackwell, vol. 34(4), pages 753-792, September.
    2. Omar H. Fares & Irfan Butt & Seung Hwan Mark Lee, 2023. "Utilization of artificial intelligence in the banking sector: a systematic literature review," Journal of Financial Services Marketing, Palgrave Macmillan, vol. 28(4), pages 835-852, December.
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    JEL classification:

    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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