Effects Of Financial Development And Digital Financial Exclusion On Elements Of Welfare In Sub-Saharan Africa

Abstract

The level of financial development is low in Sub-Saharan Africa. This has led to high rates of financial exclusion, digital and non-digital, which may in turn have influence on consumption inequality and multidimensional poverty. Nonetheless, there is a dearth of study on these relationships. This study, therefore, assessed the effect of financial development and digital financial exclusion on elements of welfare in Sub-Saharan Africa (SSA). Data was sourced from the World Bank and the Seventh Wave of Ghana Living Standard Survey (GLSS 7). The data was analysed using mean, standard deviation, histograms, graphs, and multiple regression functions estimated by Ordinary Least Squares and Random Effects. The results revealed that financial development significantly and positively affects consumption per capita. Also, it was shown that both digital and nondigital financial exclusion have a significant positive effect on consumption inequality. Furthermore, digital financial exclusion and non-digital financial exclusion significantly and positively influence multidimensional poverty. It was recommended that leaders of SSA countries make an effort to develop their financial institutions and financial markets to stimulate the level of growth desired in the subregion.