{"title":"Financial Technologies for All MENA citizens: Tackling barriers and promoting inclusion","authors":"Zakaria Elouaourti , Aomar Ibourk","doi":"10.1016/j.rspp.2024.100019","DOIUrl":null,"url":null,"abstract":"<div><p>The digital divide within the financial sector, closely intertwined with the rapid evolution of financial technologies, commonly known as \"FinTech,\" has fundamentally reshaped the landscape of financial services. These innovations have ushered in novel avenues for accessibility, enhancing the security of financial transactions and transcending traditional spatiotemporal constraints. This paper embarks on a journey to address key inquiries within the MENA region. It explores digital financial inclusion levels across MENA countries, identifies segments facing digital financial exclusion, scrutinizes the role of the digital divide, often compounded by a lack of financial literacy, as a barrier to financial inclusion, and investigates how FinTech can serve as a catalyst for inclusive development, with a specific focus on marginalized groups like women and the elderly. Our research employs a comprehensive mixed-methodological approach. We draw from micro-level data sourced from 9053 individuals, extracted from the World Bank's latest Global Findex 2021 database. Our comparative analysis, rooted in a two-step principal component analysis method to create the MENA Digital Financial Inclusion Index (DFII), shedding light on the current state of digital financial inclusion in the MENA region. Despite recent initiatives, our findings underscore that digital financial inclusion in the region remains relatively low. Furthermore, our estimations, based on the <strong>Heckman selection methodology</strong>, emphasize the pivotal role played by factors such as educational attainment, labor force participation, information and communication technologies, and internet access as primary drivers of digital financial inclusion in the MENA region. Our research contributes a substantial body of empirical evidence regarding digital financial inclusion levels across MENA countries, charting a path toward bridging the digital divide within the financial sector. These strategies encompass enhancing digital financial literacy, catalyzing broader participation in the labor market, and facilitating expanded access to mobile phones and the Internet. In light of our comprehensive dataset, the policy implications drawn from our study are of paramount interest to financial sector regulators in the MENA region, grounded in the real-life experiences of the individuals constituting our database, with the overarching goal of elevating digital financial inclusion in the region to new heights.</p></div>","PeriodicalId":45520,"journal":{"name":"Regional Science Policy and Practice","volume":"16 6","pages":"Article 100019"},"PeriodicalIF":1.7000,"publicationDate":"2024-06-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://www.sciencedirect.com/science/article/pii/S1757780224000519/pdfft?md5=7ec756cbc33274c00bc8444dfcc4678e&pid=1-s2.0-S1757780224000519-main.pdf","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Regional Science Policy and Practice","FirstCategoryId":"1085","ListUrlMain":"https://www.sciencedirect.com/science/article/pii/S1757780224000519","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q2","JCRName":"GEOGRAPHY","Score":null,"Total":0}
引用次数: 0
Abstract
The digital divide within the financial sector, closely intertwined with the rapid evolution of financial technologies, commonly known as "FinTech," has fundamentally reshaped the landscape of financial services. These innovations have ushered in novel avenues for accessibility, enhancing the security of financial transactions and transcending traditional spatiotemporal constraints. This paper embarks on a journey to address key inquiries within the MENA region. It explores digital financial inclusion levels across MENA countries, identifies segments facing digital financial exclusion, scrutinizes the role of the digital divide, often compounded by a lack of financial literacy, as a barrier to financial inclusion, and investigates how FinTech can serve as a catalyst for inclusive development, with a specific focus on marginalized groups like women and the elderly. Our research employs a comprehensive mixed-methodological approach. We draw from micro-level data sourced from 9053 individuals, extracted from the World Bank's latest Global Findex 2021 database. Our comparative analysis, rooted in a two-step principal component analysis method to create the MENA Digital Financial Inclusion Index (DFII), shedding light on the current state of digital financial inclusion in the MENA region. Despite recent initiatives, our findings underscore that digital financial inclusion in the region remains relatively low. Furthermore, our estimations, based on the Heckman selection methodology, emphasize the pivotal role played by factors such as educational attainment, labor force participation, information and communication technologies, and internet access as primary drivers of digital financial inclusion in the MENA region. Our research contributes a substantial body of empirical evidence regarding digital financial inclusion levels across MENA countries, charting a path toward bridging the digital divide within the financial sector. These strategies encompass enhancing digital financial literacy, catalyzing broader participation in the labor market, and facilitating expanded access to mobile phones and the Internet. In light of our comprehensive dataset, the policy implications drawn from our study are of paramount interest to financial sector regulators in the MENA region, grounded in the real-life experiences of the individuals constituting our database, with the overarching goal of elevating digital financial inclusion in the region to new heights.
期刊介绍:
Regional Science Policy & Practice (RSPP) is the official policy and practitioner orientated journal of the Regional Science Association International. It is an international journal that publishes high quality papers in applied regional science that explore policy and practice issues in regional and local development. It welcomes papers from a range of academic disciplines and practitioners including planning, public policy, geography, economics and environmental science and related fields. Papers should address the interface between academic debates and policy development and application. RSPP provides an opportunity for academics and policy makers to develop a dialogue to identify and explore many of the challenges facing local and regional economies.