The impact of central bank digital currencies on financial inclusion

Tan, Hui Ni (2025) The impact of central bank digital currencies on financial inclusion. Final Year Project, UTAR.

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Abstract

This study makes use of a panel data approach involving some selected countries between the years 2015 and 2023 to analyze the effects of Central Bank Digital Currencies (CBDCs) on financial inclusion. Using different reports and research, the number of account holdings is regarded as a financial inclusion indicator. Moreover, it also analyses what impacts trust, technology accessibility, and financial knowledge have on the relationship between CBDCs and financial inclusion. In order to get credible results, robustness tests and Fixed Effects Panel Regression analysis are applied. The results show that trust has a positively and significantly affect on financial inclusion in across the countries. Conversely, in the initial stages of CBDC adoption, financial inclusion and financial accounts ownership show an ambiguous and sometimes negative relationship. Because of limitations in data and multicollinearity problems, it is found that the moderating effect of trust, technology accessibility, and financial knowledge is modest and unstable. In broad summary, the results underscore that it is not possible without financial institutions and financial knowledge if financial inclusivity is going to be improved by CBDC.

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