Impact of Financial Technology, Banking Access on Financial Inclusion with mediating role of Financial Literacy

Abstract

This study aims to investigate the impact of financial technology (FinTech) and banking access on financial inclusion, while considering the mediating role of financial literacy. Financial inclusion refers to the accessibility and usage of various financial services by individuals and businesses, particularly those who are traditionally underserved or excluded from the formal banking system. The study will analyze how the advancements in FinTech and increased banking access can contribute to enhancing financial inclusion, with a focus on how financial literacy plays a crucial role in this relationship. The results show a strong positive correlation between FinTech usage and banking access, indicating that developing financial technology helps make banking resources more accessible. Additionally, the study finds a connection between traditional banking access and financial inclusion, showing that better access to these services has a favorable impact on a person's level of financial inclusion. A crucial component of the interaction between FinTech, banking access, and financial inclusion is the mediating function of financial literacy. The effect of FinTech and banking access on financial inclusion has been found to be somewhat mediated by financial literacy. Financial inclusion outcomes are improved because people with higher financial literacy levels typically benefit more from technological improvements and banking services.