All issues › Volume 1, Issue 2, September – October 2026
Digital Reach Is Not Financial Inclusion: Physical Banking Access and Account Ownership in Middle-Income Economies — A Within-Between Panel Analysis, 2011–2024
Assistant Professor of Commerce, Sona College of Arts and Science, Salem – 05, Tamil Nadu, India
Abstract
Purpose — This paper asks whether broad digital connectivity and physical banking outreach make distinct contributions to account ownership in middle-income economies. It separates persistent cross-country access conditions from shorter-run changes within countries. Design/methodology/approach — An unbalanced panel combines five World Bank Global Findex waves (2011, 2014, 2017, 2021, and 2024) with one-year-lagged World Development Indicators and IMF Financial Access Survey indicators. The estimation sample contains 312 country-wave observations from 76 lower- and upper-middle-income economies. Principal-component indices summarize digital access (internet use and mobile subscriptions) and physical access (commercial-bank branches and ATMs). Two-way fixed-effects and Mundlak-type within-between models use country-clustered standard errors. Findings — Country-average physical access is associated with a 7.735-percentage-point higher account-ownership rate per standard-deviation increase (SE = 3.021, p = 0.012). The comparable within-country estimate is 1.124 points and not statistically significant (SE = 0.720, p = 0.122); the between-within contrast is 6.611 points (p = 0.028). Neither the within nor between digital-connectivity coefficient is distinguishable from zero after physical access, income, female labour-force participation, urbanization, inflation, and survey-wave effects are controlled. The physical-access result survives alternative index weighting, exclusion of the 2011 definition-break wave, exclusion of 2021, component substitution, inflation winsorization, and a log-odds outcome; the smaller balanced sample preserves the coefficient magnitude but not its precision. Originality/value — The findings distinguish generic connectivity from usable financial-service infrastructure. They imply that digital reach alone is not a sufficient proxy for financial inclusion and that durable access ecosystems still require service points, cash-in/cash-out capacity, trust, identity systems, consumer protection, and active account use.
Keywords: financial inclusion, account ownership, digital connectivity, physical banking access, middle-income economies, panel data
How to cite
Rajeswari, P. V. (2026). Digital Reach Is Not Financial Inclusion: Physical Banking Access and Account Ownership in Middle-Income Economies — A Within-Between Panel Analysis, 2011–2024. Imaginex International Journal of Interdisciplinary Research and Reviews, 1(2), 25–35.