Relationship between Digital Financial Inclusion and Country Development

firstₚage Download PDF settings Order Article Reprints Font Type: Arial Georgia Verdana Font Size: Aa Aa Aa Line Spacing:    Column Width:    Background: Open AccessAbstract Relationship between Digital Financial Inclusion and Country Development † by Marija AntonijevićMarija Antonijević SciProfiles Scilit Preprints. org Google Scholar * and Ivana DomazetIvana Domazet SciProfiles Scilit Preprints. org Google Scholar Institute of Economic Sciences, 11000 Belgrade, Serbia * Author to whom correspondence should be addressed. † Presented at the International Scientific Conference on Digitalization, Innovations https: //doi. org/10. 3390/proceedings2024101010 Published: 10 May 2024 Download keyboardₐrrowdown Download PDF Download PDF with Cover Download XML Download Epub Versions Notes Keywords: financial inclusion; digital financial services; development; worldwide; Global Findex database 2021 1. ObjectivesImprovements in ICT, digitization, and changes in individuals' behavior have contributed to the global transformation of the financial sector. The significance of digital channels lies in the fact that individuals can achieve a higher level of satisfaction by using the wide range of features banks provide via digital services 1. Additionally, digital financial services (DFSs) can improve the state and reduce the gap in financial inclusion, especially in developing countries 2. Therefore, possessing the required level of digital skills is essential in the digital economy 3, 4, 5. Given that income represents a driver for executing digital banking activities, the main questions to be answered concern whether there is a linear relationship between the level of county development and the following variables: Owning a financial institution account;Using a mobile phone or the Internet to pay bills;Making a digital in-store merchant payment using a mobile phone;Receiving digital payments. 2. MethodologyThe authors gathered data from publicly available databases for 116 countries worldwide in 2021 to examine the relationship between development and the mentioned variables. The development was measured according to the Gross National Income per capita (GNI p. c. ). The data for the variables related to financial inclusion were gathered from the Global Findex database 2021. All of the studied variables were measured in a percentage of individuals. The authors used correlation analyses to examine the relationship between development and financial inclusion. 3. ResultsThe correlation analysis results show a statistically significant strong positive linear relationship between the development of a country and the following variables: (1) owning a financial institution account, (2) using a mobile phone or the Internet to pay bills, and (3) receiving digital payments. The authors found a moderately strong relationship between making a digital in-store merchant payment using a mobile phone and the level of development. These findings are in line with prior studies 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, and support the critical role that income, i. e. , country development, plays in determining the use of digital banking services by citizens, and vice versa. 4. ImplicationsThis study's findings provide valuable insights into financial inclusion in the development context. The results represent a foundation for governments and bank managers to improve the affordability and accessibility of digital services for their citizens. Thus, the results emphasize the critical importance of addressing the financial inclusion challenge, particularly in low- and lower-middle-income countries (e. g. , Sierra Leone, Cambodia, Egypt, Tunisia, Gaza and the West Bank, Tajikistan, Pakistan, Lebanon, Nicaragua), highlighting the essential role of relevant bodies. 5. Originality ValueNo recent study has investigated the relationship between development and the usage of digital banking services globally using the latest available data for 2021. Regarding this, it is important to investigate individuals' behavior in times of COVID-19 regarding country development, considering the critical role of digital financial services. 6. ContributionsThis paper will expand the literature in this research area, considering that no similar study has examined the relationship between development and individuals' behavior related to digital banking services using the latest available data and the new variable of making a digital in-store merchant payment using a mobile phone. Author ContributionsConceptualization, M. A. and I. D. ; methodology, M. A. ; software, M. A. ; validation, I. D. ; formal analysis, I. D. ; investigation, M. A. ; resources, M. A. and I. D. ; data curation, M. A. ; writing—original draft preparation, M. A. and I. D. ; writing—review and editing, M. A. and I. D. ; visualization, M. A. and I. D. ; supervision, I. D. ; project administration, M. A. and I. D. ; funding acquisition, M. A. and I. D. All authors have read and agreed to the published version of the manuscript. FundingThis research received no external funding. Institutional Review Board StatementNot applicable. Informed Consent StatementNot applicable. Data Availability StatementThe data sources for the variables are listed below. Financial inclusion, available online: https: //www. worldbank. org/en/publication/globalfindex/Data (accessed on 20 September 2023) ; Gross National Income per capita, available online: https: //data. worldbank. org/indicator/NY. GNP. PCAP. CD (accessed on 20 September 2023). AcknowledgmentsThis paper was supported by the Ministry of Science, Technological Development and Innovation of the Republic of Serbia under contract number 451-03-47/2023-01/200005. Conflicts of InterestThe authors declare no conflicts of interest. ReferencesDomazet, I. S. ; Neogradi, S. Digital marketing and service industry. In Managing Diversity, Innovation, and Infrastructure in Digital Business; IGI Global: Hershey, PA, USA, 2019; pp. 20–40. Google ScholarAntonijević, M. ; Ljumović, I. ; Ivanović, Đ. Is there a Gender Gap in Financial Inclusion Worldwide? J. Women's Entrep. 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This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (https: //creativecommons. org/licenses/by/4. 0/). Share and Cite MDPI and ACS Style Antonijević, M. ; Domazet, I. Relationship between Digital Financial Inclusion and Country Development. Proceedings 2024, 101, 10. https: //doi. org/10. 3390/proceedings2024101010 AMA Style Antonijević M, Domazet I. Relationship between Digital Financial Inclusion and Country Development. Proceedings. 2024; 101 (1): 10. https: //doi. org/10. 3390/proceedings2024101010 Chicago/Turabian Style Antonijević, Marija, and Ivana Domazet. 2024. "Relationship between Digital Financial Inclusion and Country Development" Proceedings 101, no. 1: 10. https: //doi. org/10. 3390/proceedings2024101010 Article Metrics No No Article Access Statistics Multiple requests from the same IP address are counted as one view.