Financial Inclusion, Globalization and Economic Empowerment: Insights from Asian Countries

Abstract

Financial inclusion in Asian countries still facing difficulties in this regard, including inadequate infrastructure, regulatory problems and socioeconomic obstacles, which limit the availability to financial services for the population of such countries. In response to these challenges, this study examined relationships between financial inclusion (FI), globalization, and economic empowerment in Asian countries. This research addresses the gap by examining how financial inclusion influences economic empowerment, fostering Globalization, and stimulating the integration of Asian economies into the global financial system. The study employs a dynamic panel data methodology, using Generalized Method of Moments (GMM) estimation, to analyze data from 13 Asian countries spanning from 2004 to 2024. The results suggested that financial inclusion significantly contributes to economic growth and enhances human development, measured through the improvements in education, health, and income level. Further, the study revealed that foreign direct investment (FDI) plays a pivotal role in driving financial inclusion, while inflation reduces its positive effects on economic empowerment. This research emphasizes the needed to develop such policies that enhance financial access, particularly in underdeveloped areas of Asia. The study also highlights the role of Banks Services in fostering inclusive economic development. Furthermore this study also highlights the influence of inflation and social well-being (HDI) in strengthening the effects of financial inclusion on economic empowerment and globalization. This contribution provides valuable insights for policymakers aiming to leverage financial inclusion as a tool for sustainable economic development and integration into the global economy to Asia as well.