Eco-tech synergy in South Asia: Leveraging FINTECH for sustainable development and environmental resilience

This study addresses an under-explored nexus in environmental economics by offering the region's specific evidence on how financial-technology diffusion influences carbon dioxide emissions within South Asia, where rapid output growth remains coupled with dominant fossil-fuel use. Existing studies either omit the subcontinent from cross-country panels, apply first-generation estimators that neglect cross-sectional dependence and slope heterogeneity, or assume FINTECH to be unconditionally benign. This study uses panel dataset of five South Asian countries from 1995 to 2022, we deploy the Augmented Mean Group (AMG) and Common Correlated Effects Mean Group (CCEMG) estimators that jointly accommodate country-specific coefficients, unobserved common factors, and dynamic feedbacks. The long-run estimates reveal that a one-percentage-point increase in green innovation, natural-resource rents, and renewable-energy penetration reduces CO₂ emissions by 0.048%, 0.383%, and 0.286%, respectively, whereas equivalent expansions in FINTECH adoption and urbanization augment emissions by 0.038% and 0.543%. These findings imply that regulators should embed verifiable environmental screens within FINTECH sandboxes, earmark resource-rent windfalls for scalable renewable-energy infrastructure, and enforce compact-city zoning integrated with low-carbon public transit. Collectively, these targeted interventions provide South Asian policymakers with a coherent strategy to advance SDG 13 without compromising the growth imperatives articulated in SDG 8.