Fintech, Financial Inclusion, and Social Challenges: The Role of Financial Technology in Social Inequality

This chapter reviews the emerging literature on the interaction between fintech, financial inclusion, and social inequality. Given the focus of institutions and regulators’ attention on climate change and the need to reduce emissions and guide the economy towards a green future, the application of technology to finance can provide an important contribution in the transition towards a more equal and inclusive social context. In this chapter, we investigate how financial technology and fintech companies can facilitate the implementation of the United Nations 2030 agenda and the achievement of the Sustainable Development Goals (SDGs), which require the full inclusion of all actors in the financial system. New technologies can reduce costs while increasing speed and accessibility, enabling more personalized and scalable financial services. In this way, they can allow for easier access to banking services and payment instruments, promoting economic growth and helping to solve a range of social problems such as low employment, poverty, and income inequality in both developed and developing countries. In fact, financial inclusion is not only an objective but also an enabler and accelerator of economic growth. Furthermore, fintech platforms may be able to channel resources into achieving sustainable social goals. The question is, therefore, how financial technology and fintech companies can affect the reduction of social inequalities. By analyzing the most important contributions of scholars on the subject, this study aims to highlight the role that fintech has or could have in the path towards the 2030 social goals and the elimination of inequalities. Finally, we investigate the main critical issues related to low financial literacy, highlighting the need to activate tools complementary to the construction of infrastructures for the effective achievement of financial inclusion objectives.