Financial inclusion and FinTech: A comparative study of countries following Islamic finance and conventional finance

Using data from World Bank and Global Islamic Finance Report, this paper aims to compare the performance of countries following Islamic and conventional finance system in terms of financial inclusion and FinTech.

Ten countries from both financial systems have been selected based on the presence of Islamic finance and conventional finance in the country. Data was analyzed from year 2011 to 2017 and keeping the former as base year to measure the change in the population fraction.

The findings found that Islamic finance countries are more inclusive in terms of financial inclusion and women are financially more empowered as compared to the counterpart. On the contrary, countries with conventional finance have a higher number of FinTech users.

The difference between the performances of two systems in terms of financial inclusion is relatively small; therefore, future studies should incorporate more indicators for financial inclusion.

This study will be useful for understanding the nature of both financial systems, and the further research can be done to find the determinants of financial inclusion.