RESEARCH FOR REWATDS

Abstract
Despite its growing recognition in global policy agendas, the implications of financial inclusion across the three dimensions of sustainable development—economic, social, and environmental—remain underexplored. This study examines how access to credit, savings, and digital financial tools influence economic growth, income inequality, and environmental outcomes across 50 developing countries from 2000 to 2022. Employing System GMM and quantile regression, we find that while financial inclusion significantly stimulates economic growth and reduces income disparities, it can exacerbate environmental degradation where green lending mechanisms are absent. Heterogeneous patterns across development quantiles suggest that the benefits of financial inclusion are conditional on institutional capacity and environmental safeguards. These findings urge policymakers to embed sustainability-linked conditions into inclusion strategies, especially in credit expansion and fintech policies.

Keywords: financial inclusion, inclusive growth, inequality, green finance, sustainable development, environmental trade-offs, digital finance, system GMM, SDGs