Measuring Digital Financial Inclusion in Emerging Market and Developing Economies: A New Index

Adoption of technology in the financial services industry has been accelerating in recent years. To assess its contribution to financial inclusion, we develop a novel digital financial inclusion index covering 52 emerging market and developing economies. We find that (i) the adoption of digital financial services has been a key driver of financial inclusion; and (ii) there is wide variation across countries and regions, with the greatest progress recorded in Africa and Asia. Given the accelerated adoption of digital payments during the COVID-19 pandemic, policies are needed to close the digital divide to ensure continued progress in financial inclusion and safeguard trust in financial services.