Leveraging Fintech for Sustainable Development in Emerging Economies – A Policy Perspective

Abstract

Technological advancements in the provision of financial services are transforming the economic landscape by providing opportunities for financial institutions, corporate sector, and consumers. Financial technologies (fintech) offer broader economic development and inclusive growth and facilitate international payments and remittances. Fintech applications, such as mobile wallets and crowdfunding that are hugely successful, especially in developing countries such as India, are examples of how simple technologies can enhance financial inclusion through the decentralized provision of payments, borrowings, and risk management. However, these innovations also create challenges for regulators. The emerging fintech models raise concerns on investor protection, adequacy of existing regulations and potential threats to financial stability, leading to questions on the policies and institutional framework required to tap into the benefits of these technologies securely. In this paper, we look at the landscape of fintech companies and their suitability for financing sustainable development. The paper also examines the policy and institutional frameworks required for the effective utilization of fintech for sustainable development. Fintech has the potential to involve the private sector to finance sustainable development and hence the paper would be of interest to policymakers, particularly in developing countries, as many struggles to bridge gaps in financing their sustainable development goals (SDGs)