The Impact of Fintech on Financial Inclusion in North Africa

Evidence From Method of Moments Quantile Regression

Abstract

Our study analyze the influence of Fintech on financial inclusion in nations located in
North Africa (Algeria, Tunisia, and Morocco) between 2004 and 2022. Employing the Method of
Moments Quantile Regression (MM-QR) framework, we analyze the relationship between Fintech
adoption (proxied by ATMs per 100,000 adults) and financial inclusion (represented by branches
of commercial banks for every 100,000 adults), incorporating control variables like fixed telephone
subscriptions and primary school enrollment. The results of our study indicate a clear and
statistically significant positive correlation between Fintech and financial inclusion. The coefficient
for Fintech exhibits a decreasing trend across quantiles, in areas where there is little availability to
conventional banking services. Additionally, fixed telephone subscriptions display a significant
impact on financial inclusion in middle quantiles and remains insignificant for all other quantile.
Conversely, primary school enrollment demonstrates a positive and increasing association across
all levels of quantiles, highlighting its crucial role in fostering financial literacy and inclusion.