The Nexus between Fintech and Financial Stability; Moderated Mediated by Financial Inclusion and Economic Vulnerability: Evidence from Cross-country Analysis

Authors

  • Bushra Ayaz PhD Scholar, Department of Management Sciences, Islamia College Peshawar, KP, Pakistan.
  • Mustafa Afeef Associate Professor, Department of Management Sciences, Islamia College Peshawar, KP, Pakistan.
  • Shahid Jan Associate Professor, Department of Management Sciences, Islamia College Peshawar, KP, Pakistan.

DOI:

https://doi.org/10.54183/jssr.v3i2.357

Keywords:

Fintech, Financial Stability, Financial Inclusion, Economic Vulnerability

Abstract

Financial innovations are essential for fostering economic expansion. The outcomes of studies looking into this connection have been conflicting. No research to yet made an attempt to investigate the potential mediating function of financial inclusion in articulating the link between innovations and growth. In order to provide a comprehensive understanding of how income inequality might be addressed in developing, least developed, and low-income nations, this study makes a unique addition by looking at the joint dynamics among the four constructs. In order to promote financial inclusion and economic progress, the findings suggested that governments should make investments in the technology infrastructure that the financial sector may use to deliver financial services.

References

Andries, A. M. (2009). Theories regarding financial intermediation and financial intermediaries – a survey. USV Annals of Economics and Public Administration, 9(2), 254–261. http://annals.seap.usv.ro/index.php/annals/article/viewArticle/229

Arner, D. W., Zetzsche, D. A., Buckley, R. P., & Barberis, J. N. (2017). Fintech and Regtech: Enabling innovation while preserving financial stability. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.3211708

Asongu, S. A., & Nwachukwu, J. C. (2018). Educational quality thresholds in the diffusion of knowledge with mobile phones for inclusive human development in sub-Saharan Africa. Technological Forecasting and Social Change, 129, 164-172. https://doi.org/10.1016/j.techfore.2018.01.004

Asongu, S. A., & Odhiambo, N. M. (2018). Human development thresholds for inclusive mobile banking in developing countries. African Journal of Science, Technology, Innovation and Development, 10(6), 735-744. https://doi.org/10.1080/20421338.2018.1509526

Bayram, O., Talay, I., & Feridun, M. (2022). Can Fintech promote sustainable finance? Policy lessons from the case of Turkey. Sustainability, 14(19), 12414. https://doi.org/10.3390/su141912414

Bollen, K. A. (1989). Structural equations with latent variables (Vol. 210): John Wiley & Sons.

Braggion, F., Manconi, A., & Zhu, H. (2017). Is FinTech a Threat to Financial Stability? Evidence from Peer-to-Peer Lending in China. Social Science Research Network. https://doi.org/10.2139/ssrn.2957411

Brave, S. A., & Butters, R. A. (2011). Monitoring financial stability: A financial conditions index approach. Economic Perspectives, 35(1), 22. https://ssrn.com/abstract=1758783

Daud, S. N., Ahmad, A. H., Khalid, A., & Azman-Saini, W. (2022). FinTech and financial stability: Threat or opportunity? Finance Research Letters, 47, 102667. https://doi.org/10.1016/j.frl.2021.102667

Demir, A., Pesqué-Cela, V., Altunbas, Y., & Murinde, V. (2020). Fintech, financial inclusion and income inequality: A quantile regression approach. The European Journal of Finance, 28(1), 86-107. https://doi.org/10.1080/1351847x.2020.1772335

Demirgüç-Kunt, A., Klapper, L., Singer, D., & Ansar, S. (2022). The global Findex database 2021. https://doi.org/10.1596/978-1-4648-1897-4

Domeher, D., Konadu-Yiadom, E., & Aawaar, G. (2022). Financial innovations and economic growth: Does financial inclusion play a mediating role? Cogent Business & Management, 9(1). https://doi.org/10.1080/23311975.2022.2049670

Giglio, F. (2021). Fintech: A literature review. EUROPEAN RESEARCH STUDIES JOURNAL, XXIV(Issue 2B), 600-627. https://doi.org/10.35808/ersj/2254

Gnangnon, S. K. (2022). Effect of structural economic vulnerability on the participation in international trade. Journal of Risk and Financial Management, 15(9), 417. https://doi.org/10.3390/jrfm15090417

Hanif, M., Khan, Y., Jamal, S., Gul, S., & Zeeshan, M. (2023). Role of corporate governance in industries facing difference levels of competition: Empirical evidence from Pakistan. Winter 2023, 3(1), 639-658. https://doi.org/10.54183/jssr.v3i1.188

Jagtiani, J., & John, K. (2018). Fintech: The impact on consumers and regulatory responses. Journal of Economics and Business, 100, 1-6. https://doi.org/10.1016/j.jeconbus.2018.11.002

Kammoun, S., Loukil, S., & Loukil, Y. B. (2020). The impact of FinTech on economic performance and financial stability in MENA zone. Advances in Finance, Accounting, and Economics, 253-277. https://doi.org/10.4018/978-1-7998-0039-2.ch013

Khan, I., Khan, I., Sayal, A. U., & Khan, M. Z. (2021). Does financial inclusion induce poverty, income inequality, and financial stability: Empirical evidence from the 54 African countries? Journal of Economic Studies, 49(2), 303-314. https://doi.org/10.1108/jes-07-2020-0317

Khan, Y. (2022). The sophisticated role of accounting information system (AIS) on the performance of Small and medium-sized enterprises (SMEs): Evidence from an emerging economy. Competitive Social Science Research Journal, 3(2), 199-214. https://cssrjournal.com/index.php/cssrjournal/article/view/273

Khan, Y., Ahmad, W., Awan, S. H., & e Ali, M. S. (2022). Assessing the relevance of framing messages on backing intentions in crowdfunding social cause-related marketing campaign. Journal of Social Sciences Review, 2(4), 55-65. https://doi.org/10.54183/jssr.v2i3.61

Khan, Y., Ahmad, W., & Malik, F. (2022). THE INFLUENCE OF CORPORATE GOVERNANCE ON ACCOUNTING CONSERVATISM IN TOP NON-FINANCIAL FIRMS OF PSX: THE MODERATING ROLE OF AUDIT QUALITY. Competitive Social Science Research Journal, 3(1), 321-340.

Malik, A. H., Md Isa, A. H., Jais, M. B., Ur Rehman, A., & Ali Khan, M. (2022). Financial stability of Asian nations: Governance quality and financial inclusion. Borsa Istanbul Review, 22(2), 377-387. https://doi.org/10.1016/j.bir.2021.05.005

Mindra, R., & Moya, M. (2017). Financial self-efficacy: A mediator in advancing financial inclusion. Equality, Diversity and Inclusion: An International Journal, 36(2), 128-149. https://doi.org/10.1108/edi-05-2016-0040

Nguyen, C. P., & Su, T. D. (2021). Easing economic vulnerability: Multidimensional evidence of financial development. The Quarterly Review of Economics and Finance, 81, 237-252. https://doi.org/10.1016/j.qref.2021.06.007

Nguyen, Q. K. (2022). The effect of FinTech development on financial stability in an emerging market: The role of market discipline. Research in Globalization, 5, 100105. https://doi.org/10.1016/j.resglo.2022.100105

Okello Candiya Bongomin, G., & Ntayi, J. (2019). Trust: Mediator between mobile money adoption and usage and financial inclusion. Social Responsibility Journal, 16(8), 1215-1237. https://doi.org/10.1108/srj-01-2019-0011

Okello Candiya Bongomin, G., Yourougou, P., & Munene, J. C. (2019). Digital financial innovations in the twenty-first century. Journal of Economic and Administrative Sciences, 36(3), 185-203. https://doi.org/10.1108/jeas-01-2019-0007

Pantielieieva, N., Khutorna, M., Lytvynenko, O., & Potapenko, L. (2020). FinTech, RegTech and traditional financial intermediation: Trends and threats for financial stability. Data-Centric Business and Applications, 1-21. https://doi.org/10.1007/978-3-030-35649-1_1

Pantielieieva, N., Krynytsia, S., Khutorna, M., & Potapenko, L. (2018). FinTech, transformation of financial intermediation and financial stability. 2018 International Scientific-Practical Conference Problems of Infocommunications. Science and Technology (PIC S&T). https://doi.org/10.1109/infocommst.2018.8632068

Sha'ban, M., Girardone, C., & Sarkisyan, A. (2019). Cross-country variation in financial inclusion: A global perspective. The European Journal of Finance, 26(4-5), 319-340. https://doi.org/10.1080/1351847x.2019.1686709

Yousaf Khan, D., Ahmad, W., & Malik, F. (2021). Does Audit Quality Moderate the Nexus Between Corporate Governance and Accounting Earnings Quality in Emerging Economies? Indian Journal of Economics and Business, 20(4), 1779.

Yue, P., Korkmaz, A. G., Yin, Z., & Zhou, H. (2022). The rise of digital finance: Financial inclusion or debt trap? Finance Research Letters, 47, 102604. https://doi.org/10.1016/j.frl.2021.102604

Downloads

Published

2023-06-30

How to Cite

Ayaz, B., Afeef, M., & Jan, S. (2023). The Nexus between Fintech and Financial Stability; Moderated Mediated by Financial Inclusion and Economic Vulnerability: Evidence from Cross-country Analysis. Journal of Social Sciences Review, 3(2), 1132–1144. https://doi.org/10.54183/jssr.v3i2.357