Thesis Public Defense | VNP29 - Lê Quang Đông Quân

The impact of internet use on financial inclusion among Vietnam’s rural households

Student: Lê Quang Đông Quân, VNP-29

Supervisor: Dr. Lê Văn Chơn

Abstract:

This thesis analyzes the relationship between internet usage and financial inclusion among rural households in Vietnam using household-level data from the 2018 Vietnam Household Living Standard Survey (VHLSS), encompassing over 25,300 households. A negative binomial model, as well as a supplement ordinal probit model, is employed to demonstrate that internet use significantly boosts the financial inclusion index of rural households. To be more specific, households that use internet are likely to use more financial products, and have the higher probability of being in the High Financial Inclusion category. As internet accessibility increases, the likelihood of households achieving higher levels of financial inclusion improves, highlighting the important role of internet access in enabling access to financial products and services. Given that internet penetration is still largely concentrated in urban areas, expanding its reach to rural regions is essential for promoting inclusive growth and improving the welfare of disadvantaged communities. The results highlight the need for making appropriate policies to develop internet infrastructure and diffusion in rural areas, as well as to maximize the economic benefits of internet adoption for rural households. These measures would help optimize the economic advantages of internet use for rural households, reflect the effort of financial institutions to bring-in underprivileged people to the mainstream financial system, and align with the Goverment’s objective of achieving inclusive growth.

Keywords: Financial Inclusion, Internet use, Rural households, Vietnam

JLT Classification: D14, L86, R51