Thesis Public Defense | VNP30 - Nguyễn Thảo My

Assessing inter-relations between fintech diffusion, financial inclusion and economic development across 63 provinces of Vietnam: a panel data study

Student: Nguyễn Thảo My, VNP-30

Supervisor: Dr. Hồ Hoàng Anh

Abstract:

This thesis investigates the interrelationships among fintech diffusion, financial inclusion, and economic development across Vietnam’s 63 provinces during the period 2015 – 2021. In the
context of rapid digital transformation and persistent regional disparities, the thesis examines whether the diffusion of fintech contributes to inclusive growth at the provincial level. Fintech
diffusion is proxied by mobile phone subscriptions, financial inclusion is measured using a demand-side composite index constructed from the Vietnam Household Living Standards Survey (VHLSS), and economic development is captured by provincial GDP per capita. To address potential simultaneity and endogeneity among the core variables, the analysis adopts a three-equation simultaneous system estimated using the Three-Stage Least Squares (3SLS) method. This framework enables explicit modeling of feedback effects and transmission mechanisms linking digital technology adoption, financial inclusion, and income outcomes. The empirical findings show that fintech diffusion significantly enhances financial inclusion, while financial inclusion exerts a positive and statistically significant effect on provincial income levels. By contrast, fintech diffusion does not directly affect economic growth, indicating that its growth-enhancing role operates primarily through the financial inclusion channel. These results highlight financial inclusion as a key mechanism through which digital technologies influence development outcomes. Overall, the study provides provincial-level evidence that fintech functions as an enabling platform for inclusive and regionally balanced economic growth in Vietnam, rather than as an independent driver of growth.

JEL Classification: O33, G21, G28, O47, R11
Keywords: fintech diffusion; financial inclusion; mobile technology; economic growth; provincial analysis; Vietnam