An Appraisal of the Impact of Financial Technologies (FinTechs) on Financial Inclusions in Selected Parts of Zambia

Abstract

Purpose: In recent years, the rise of Financial Technologies (FinTechs) has transformed the landscape of financial services, particularly in terms of expanding access to financial products and services, known as financial inclusion. The study seeks to understand how FinTech innovations contribute to bridging the gap between the banked and unbanked, promoting financial literacy, and fostering a culture of financial empowerment. Methodology: The study employed a mixed methods approach to gather comprehensive insights. A target sample size of 1,200 individuals was carefully selected across six districts— Chongwe, Shibuyunji, Chisamba, Lusaka, and Kafue—encompassing both urban and peri urban areas. These districts were chosen based on evidenced statistical literacy levels, ensuring participants had sufficient understanding of financial concepts and technology. A total of 722 responses were received, resulting in a 60% response rate. Findings: Results indicate a strong link between the emergence of FinTechs and financial inclusion. FinTech innovations, such as mobile banking, digital payments, and alternative lending platforms, have significantly lowered barriers to accessing financial services for underserved populations, including low-income individuals, small and medium-sized enterprises (SMEs), and those in remote areas. Additionally, FinTech platforms have empowered individuals by promoting financial literacy through user-friendly interfaces and personalized financial management tools. Despite these advancements, challenges persist in ensuring equitable access, particularly for marginalized communities facing digital literacy barriers, infrastructural limitations, and regulatory constraints. Unique Contribution to Theory, Policy and Practice: The study highlights the transformative role of FinTechs in democratizing access to financial services and knowledge, fostering financial empowerment, and narrowing the gap between the banked and unbanked. However, it underscores the need for collaborative efforts among governments, financial institutions, and FinTech companies to address persistent challenges. Recommendations include developing inclusive policies, improving infrastructure, and promoting digital literacy initiatives to ensure that FinTech's potential is fully harnessed in creating a more inclusive and sustainable financial ecosystem.