Digital Finance, Labor Market Integration, and Gender Inequality: Evidence from Brazil

Digital financial services have expanded rapidly across emerging economies and are often presented as tools for advancing women’s economic inclusion. However, the extent to which digital finance is associated with lower gender inequality depends on the broader structural conditions in which women live and work. This study examines the relationship between digital financial participation, labor market integration, and gender inequality in Brazil using nationally representative microdata from the 2025 Global Findex survey. Three outcomes are examined: digital account ownership, use of any digital payment, and engagement in merchant digital payments. Multivariate logit models show moderate gender gaps at early stages of digital financial participation. However, these gaps are not uniform across the population. The interaction results show that gender differences are concentrated mainly among individuals outside employment and among those without internet access. Among employed and digitally connected individuals, the gender gap becomes small and statistically insignificant across the three outcomes. A nonlinear decomposition shows that observable socioeconomic characteristics explain only a small share of the aggregate gender gap, especially for account ownership and any digital payment use. Additional robustness checks using probit and complementary log-log models support the main pattern of results. This suggests that the gender gap cannot be explained only by differences in education, income, employment, or internet access, and may also reflect unobserved household, institutional, or social constraints. The findings suggest that digital finance alone does not equalize participation. Rather, women’s digital financial participation is closely associated with their position in the labor market and their access to digital infrastructure. Because the analysis is based on cross-sectional data, the results should be interpreted as conditional associations rather than causal effects. Digital financial expansion is therefore more likely to support gender inclusion when it is linked to broader policies that strengthen women’s labor force attachment, digital connectivity, and economic autonomy.