Leveraging Digital FinTech in Microfinance Institutions for Enhanced Financial Inclusion, Sustainable Performance, and Women’s Empowerment: A Narrative Review
List of Authors
Lai Wei Sien, Mohd Fahmy-Abdullah, Noranita Abdamia
Microfinance Institutions (MFIs) play a vital role in advancing financial inclusion and socio-economic empowerment, aligning directly with the United Nations’ Sustainable Development Goals (SDG 2030), particularly poverty reduction, gender equality, and decent work. Despite their importance, many MFIs continue to face challenges in sustaining financial viability while upholding their social mission. The rise of digital financial technologies (FinTech), such as mobile banking, block chain, artificial intelligence, and big data has introduced innovative solutions to longstanding challenges by lowering operational costs, expanding service outreach, and promoting greater transparency. However, the intersection of FinTech with economic empowerment, sustainability and social inclusion remains underexplored in existing research. This literature review aims to examine how the adoption of FinTech influences the performance of microfinance institutions (MFIs). Specifically, this review sets to contribute too ongoing discussions surrounding FinTech’s role in fostering sustainability, advancing women’s empowerment and promoting inclusive economic growth. The findings provided MFIs with a fresh perspective to consider digital transformation, highlighting the interplay between digital literacy, regulatory frameworks, and the suitability and progression of digital initiative. By critically analysing these dynamics, the review deepens our understanding of how FinTech integration can shape both the operational efficacy of MFIs and the broader socio-economic environments in which they operate.