Abstract
Digital credit has shown considerable success in Kenya and is expected to provide opportunities for individuals excluded from formal loans because of their lower socioeconomic status. However, evidence supporting the greater positive impact of digital credit on financial inclusion than that of traditional loans is lacking. This study employs a multinomial logistic regression to investigate the impact of digital credit services, particularly mobile banking and FinTech loans (MBLs and FTLs), on financial inclusion in Kenya. MBLs appear to be less accessible to vulnerable populations, such as women, low-educated groups, and casual workers although both MBLs and FTLs are equally accessible to rural populations. In contrast, FTL services show no such constraints in terms of accessibility for women and low-income workers. This disparity indicates the relative inaccessibility of MBLs to vulnerable groups compared to that of FTLs; however, note that greater loan access does not always benefit vulnerable groups.
Original language | English |
---|---|
Journal | Information Technology for Development |
Early online date | 12 Sept 2024 |
DOIs | |
Publication status | E-pub ahead of print - 12 Sept 2024 |
Keywords
- FinTech
- Financial inclusion
- digital credit
- digital financial services
- mobile loan
- mobile money