A Scientific Study from the College of Business Administration and Finance on the Role of Digital Financial Inclusion in the Transition toward a Green Economy in Developing Countries
Despite the widespread promotion of financial inclusion as a key driver of sustainable development, a fundamental paradox has not received sufficient attention: traditional financial infrastructure may indirectly slow the transition to renewable energy, while digital innovations have the potential to accelerate this shift and unlock new opportunities for the green economy.
In this context, a researcher from the College of Business Administration and Finance at the International University for Science and Technology published a scientific study titled:
The study was published in the journal Quality & Quantity, ranked in the first quartile (Q1) in the Scopus database and issued by Springer Nature, with a percentile ranking of 93% (CiteScore: 7.4).
This research stands out as one of the first studies that does not examine financial inclusion or financial technology (Fintech) in isolation, but rather investigates their interaction, revealing a key paradox:
Traditional financial infrastructure (such as ATMs and bank branches) may hinder the transition toward renewable energy.
In contrast, digital innovations (such as electronic payments and digital commerce) enhance the potential of the green economy.
Methodology
The study analyzed comprehensive data from 85 developing countries over the period (2011–2021), applying advanced econometric models, including:
Panel-Corrected Standard Errors (PCSE)
Feasible Generalized Least Squares (FGLS)
These methods were used to examine the relationship between financial technology, financial inclusion, renewable energy adoption, and energy efficiency.
Key Findings
An initial negative relationship was identified between traditional financial inclusion indicators (such as ATM penetration) and renewable energy adoption, indicating that merely expanding access to banking services is not sufficient to achieve a green transition.
A clear positive effect of financial technology emerged, particularly when integrated with financial inclusion, leading to an increased share of renewable energy and improved energy efficiency.
The study confirms that the integration of financial inclusion and fintech acts as a key driver for promoting green investments and enhancing energy productivity.
Practical Implications: The Syrian Case
In light of the challenges facing the energy sector in Syria, particularly during the reconstruction phase, the study offers several important insights:
Relying solely on expanding traditional banking infrastructure may not achieve the desired transition in the clean energy sector.
It is essential to adopt fintech solutions, such as mobile payments and digital platforms, to facilitate financing for renewable energy projects, especially residential solar energy systems.
This approach can improve energy efficiency in productive sectors and support the transition toward a more sustainable and inclusive economy.
Conclusion
This research fills a significant gap in the existing literature by examining the combined impact of financial technology and financial inclusion on sustainable energy initiatives. It also provides a practical framework for policymakers in developing countries, emphasizing that leveraging financial digitalization is not limited to expanding access to financial services, but extends to becoming an effective tool for directing investments toward a greener and more resilient future
. Ultimately, this study calls for rethinking the role of financial systems—not merely as economic intermediaries, but as strategic enablers of the transition toward a sustainable economy.