EXAMINING THE NEXUS OF FINTECH ADOPTION AND FINANCIAL INCLUSION UNDER THE MEDIATING ROLE OF CUSTOMER TRUST

Maymona Areej Akmal; Sabeen Khurram Khan; Muhammad Umer Quddoos; Arslan Ahmad Siddiqi

Authors

Maymona Areej Akmal Royal Tech Contracting L.L.C, Abu Dhabi.
Dr Sabeen Khurram Khan Assistant Professor, Department of Management Sciences, COMSATS University Islamabad, Pakistan.
Dr Muhammad Umer Quddoos Associate Professor, Department of Commerce, Bahauddin Zakariya University, Multan, Punjab, Pakistan (Corresponding Author). https://orcid.org/0000-0002-1498-6822
Dr Arslan Ahmad Siddiqi Assistant Professor, Department of Management Sciences, COMSATS University Islamabad, Pakistan. https://orcid.org/0000-0002-2430-1145

Keywords:

Fintech Adoption & Financial Inclusion, Customer Trust, Diffusion of Innovation, Islamic & Conventional Banks, Institutional & Trust Theory

Abstract

This study investigates the role of FinTech adoption in enhancing financial inclusion within Pakistan’s dual banking system, focusing on the mediating role of customer trust and the moderating role of bank type (Islamic vs. conventional). Despite the rapid digitalization of financial services, Pakistan continues to face a large unbanked population due to limited digital literacy, low trust, and infrastructural constraints. Guided by Diffusion of Innovation (DOI) Trust theory and Institutional theory. The research uses a quantitative method with data obtained from customers of both Islamic and conventional banks through structured questionnaires.
I conducted the data through PLS-SEM & SmartPLS for direct, indirect, and moderating effects. The Findings suggest that Fintech adoption has a direct as well as an indirect positive and significant effect on Financial Inclusion through Customer Trust. The mediator of trust proves to be the most important factor that enhances user adoption and use continuance intentions in using Fintech services. Bank Type had a statistically indifferent moderating effect, although it reveals that the positive influence of Fintech on inclusion is pervasive through both Islamic and conventional banking.
In general, the study notes that Fintech acts as a universal enabler of financial inclusion, and it underscores the need to gain customer trust that is rooted in a secure, transparent, and user-friendly digital platform. The practical implications of the findings provide practical insights for the policy makers and banks to develop trust-stimulating Fintech plans, intending to provide greater financial inclusion, on an equity basis, in the Pakistan banking industry.

Jel Classification Codes: G21, G23, G24, D14, Z12

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