DETERMINANT OF DIGITAL FINANCIAL INCLUSION ADOPTION IN SUB SAHARAN AFRICA

Abstract

Financial exclusion remains a major global challenges, particularly in developing economies, where a large proportion of the population still lacks access to digital financial services due to limited internet penetration and infrastructure deficits. This situation is further exacerbated by technological constraints, low digital literacy, socio-demographic barrier, and weak regulatory frameworks that hinder the effective adoption and usage of digital financial system. This study investigates the determinants of digital financial inclusion in selected Sub-Saharan African countries using secondary data obtained from internationally recognized sources, including the World Development Indicators (WDI) and the International Monetary Fund (IMF). The study adopt an ex post facto research design using panel data from 22 sub-Saharan countries selected through purposive sampling. A Digital Financial Inclusion Index (DFII) is constructed using Principal Component Analysis ( using panel regression techniques. The results reveal that internet penetration (β = 0.0289, p < 0.05) has a positive and statistically significant effect on digital financial inclusion, highlighting the importance of digital infrastructure in facilitating access to digital financial service In contrast, mobile phone subscriptions (β =0.000592, p < 0.00601) do not significantly influence digital financial inclusion, suggesting that device ownership alone does not guarantee effective usage. Literacy and educational attainment (β = 0.0204, p < 0.01) positively affect DFI, while regulatory quality (β =0.0652, p < 0.471) shows limited significance, indicating that institutional frameworks must be complemented by investments in infrastructure and human capital, moreso, GDP growth (β =0.0268, p < 0.0114) has a positive and statistically significant effect on DFI. The study concludes that digital financial inclusion in Sub-Saharan Africa extends beyond technological availability and depends on reliable internet access, improved digital skills, and supportive macroeconomic conditions.The study recommends that policymakers prioritise expanding reliable internet access and strengthening digital literacy initiatives, particularly in underserved areas, to enhance the adoption and effective use of digital financial services.