Regional heterogeneity in digital financial inclusion: benchmarking Central Africa (ECCAS) against African peers and East Asian economies

This paper asks whether the marginal returns to digital infrastructure for multidimensional financial inclusion are structurally consistent across developing economies. Drawing on an unbalanced panel of 57 economies over 2010–2023, we deploy a layered identification strategy that combines two-way fixed effects, lagged reduced-form specifications, a dynamic lagged-dependent-variable model, and instrumental-variable estimation built on pre-sample baseline values interacted with a linear time trend. Three findings emerge. First, electricity access is a quantitatively dominant correlate of formal account ownership: a one-percentage-point gain in electrification is associated with a 0.62-percentage-point rise in account ownership. Second, the conversion of digital infrastructure into financial access varies systematically across regional blocs; the Economic Community of Central African States (ECCAS) records the weakest net marginal effect on account ownership among African Regional Economic Communities, suggesting that infrastructure gains are absorbed by deeper physical, macroeconomic, and institutional frictions. Moderation analysis shows that stronger rule of law amplifies the contribution of digital connectivity to financial depth, while a composite Triple-Deficit Index dampens the internet-to-savings channel. Third, internet penetration delivers a stronger net effect on digital payments in ECCAS than in the East-Asian benchmark by approximately 88%, consistent with a compensatory leapfrogging pattern in which households substitute towards mobile-money rails in institutionally fragile environments. The findings are robust to the exclusion of East Asia, an alternative pooled non-East-Asia benchmark, survey-year-only re-estimation, the dynamic specification, instrumental-variable estimation, and panel quantile regression. Together, the results indicate that digital infrastructure supports financial inclusion most effectively when it is bundled with reliable electrification and credible institutional reform.