Exploring the Impact of Debit Card Ownership  on Financial Inclusion in ASEAN+6 Countries

Yesi Hendriani Supartoyo; Latif  Adam; Erla  Mychelisda; Md Asadul Islam

doi:10.21512/jas.v13i2.12653

Authors

Yesi Hendriani Supartoyo National Research and Innovation Agency
Latif Adam National Research and Innovation Agency (BRIN)
Erla Mychelisda National Research and Innovation Agency (BRIN)
Md Asadul Islam King Fahd University of Petroleum and Minerals (KFUPM)

DOI:

https://doi.org/10.21512/jas.v13i2.12653

Keywords:

Financial inclusion, account ownership, debit card, digital finance, ASEAN+6

Abstract

This study examined the impact of debit card ownership on financial inclusion across ASEAN+6 countries. Using panel data from the Global Financial Inclusion Index (Global Findex) spanning multiple years, the research employed panel regression analysis to examine the relationship between debit card ownership and key financial inclusion indicators. Specifically, the study assessed whether debit card ownership influences the likelihood of owning a formal bank account, accessing formal credit, engaging in financial transactions through regulated institutions, owning a mobile money account, and possessing a mobile phone. The findings reveal that debit card ownership significantly increases the likelihood of having a formal bank account, accessing credit, and engaging in financial transactions through regulated financial institutions. However, while mobile money account ownership and mobile phone ownership show positive associations with financial inclusion, their effects are not statistically significant. These results suggest that debit cards remain an important gateway to formal financial services despite the rapid expansion of digital financial technologies in the region. The study highlights the role of debit cards as an accessible and cost-effective financial instrument that lowers transaction costs, reduces dependence on cash-based transactions, and facilitates broader financial participation. The findings also underscore the importance of financial literacy, supportive regulatory frameworks, and banking infrastructure in ensuring that debit card usage translates into meaningful financial engagement. The policy implications suggest that expanding access to debit card, particularly among underserved and rural communities, can be an effective strategy to strengthen financial inclusion and promote inclusive economic development across ASEAN+6 countries.

Dimensions

References

Abdelghaffar, R. A., Emam, H. A., & Samak, N. A. (2023). Financial inclusion and human development: Is there a nexus? Journal of Humanities and Applied Social Sciences, 5(3), 163–177. https://doi.org/10.1108/jhass-11-2021-0178

Ahmad, A. H., Green, C., & Jiang, F. (2020). Mobile money, financial inclusion and development: A review with reference to African experience. Journal of Economic Surveys, 34(4), 753–792. https://doi.org/10.1111/joes.12372

Alabdulatif, A., Samarasinghe, R., & Thilakarathne, N. N. (2023). A novel robust geolocation-based multi-factor authentication method for securing ATM payment transactions. Applied Sciences, 13(19). https://doi.org/10.3390/app131910743

Aracil, E., Gómez-Bengoechea, G., & Moreno-de-Tejada, O. (2022). Institutional quality and the financial inclusion-poverty alleviation link: Empirical evidence across countries. Borsa Istanbul Review, 22(1), 179–188. https://doi.org/10.1016/j.bir.2021.03.006

Bachas, P., Gertler, P., Higgins, S., & Seira, E. (2021). How debit cards enable the poor to save more. The Journal of Finance, 76(4), 1913–1957. https://doi.org/10.1111/jofi.13021

Baetschmann, G., Ballantyne, A., Staub, K. E., & Winkelmann, R. (2020). feologit: A new command for fitting fixed-effects ordered logit models. Stata Journal, 20(2), 253–275. https://doi.org/10.1177/1536867X20930984

Breuer, M., & deHaan, E. (2024). Using and interpreting fixed effects models. Journal of Accounting Research, 62(4), 1183–1226. https://doi.org/10.1111/1475-679X.12559

Buckley, R. P., Arner, D. W., Zetzsche, D. A., Lu, D. Z., & Veidt, R. (2019, May 16). Sustainability, fintech and financial inclusion. https://ssrn.com/abstract=3387359

Bui, M. T. T., & Luong, T. N. O. (2023). Financial inclusion for the elderly in Thailand and the role of information communication technology. Borsa Istanbul Review, 23(4), 818–833. https://doi.org/10.1016/j.bir.2023.02.003

Carpio-Pinedo, J., Romanillos, G., Aparicio, D., Martín-Caro, M. S. H., García-Palomares, J. C., & Gutiérrez, J. (2022). Towards a new urban geography of expenditure: Using bank card transactions data to analyze multi-sector spatiotemporal distributions. Cities, 131. https://doi.org/10.1016/j.cities.2022.103894

Chang, V., Baudier, P., Zhang, H., Xu, Q., Zhang, J., & Arami, M. (2020). How Blockchain can impact financial services – The overview, challenges and recommendations from expert interviewees. Technological Forecasting and Social Change, 158. https://doi.org/10.1016/j.techfore.2020.120166

Chen, Y., kumara, E. K., & Sivakumar, V. (2023). Investigation of finance industry on risk awareness model and digital economic growth. Annals of Operations Research, 326, 15. https://doi.org/10.1007/s10479-021-04287-7

Coffie, C. P. K., Zhao, H., & Mensah, I. A. (2020). Panel econometric analysis on mobile payment transactions and traditional banks effort toward financial accessibility in sub-Sahara Africa. Sustainability, 12(3), 895. https://doi.org/10.3390/su12030895

Daragmeh, A., Lentner, C., & Sági, J. (2021). FinTech payments in the era of COVID-19: Factors influencing behavioral intentions of “Generation X” in Hungary to use mobile payment. Journal of Behavioral and Experimental Finance, 32. ‌https://doi.org/‌‌10.1016/j.jbef.2021.100574

Darusalam, D., Janssen, M., Sohag, K., Omar, N., & Said, J. (2021). The Influence of ICT on the control of corruption: A study using panel data from ASEAN countries. International Journal of Public Administration in the Digital Age (IJPADA), 8(1). https://doi.org/10.4018/IJPADA.20210101.oa2

Demirgüç-Kunt, A., Klapper, L., Singer, D., Ansar, S., & Hess, J. (2020). The global findex database 2017: Measuring financial inclusion and opportunities to expand access to and use of financial services. The World Bank Economic Review, 34, S2–S8. https://doi.org/10.1093/wber/lhz013

Djalante, R., Nurhidayah, L., Van Minh, H., Phuong, N. T. N., Mahendradhata, Y., Trias, A., Lassa, J., & Miller, M. A. (2020). COVID-19 and ASEAN responses: Comparative policy analysis. Progress in Disaster Science, 8. https://doi.org/10.1016/j.pdisas.2020.100129

Erlando, A., Riyanto, F. D., & Masakazu, S. (2020). Financial inclusion, economic growth, and poverty alleviation: evidence from eastern Indonesia. Heliyon, 6(10). https://doi.org/10.1016/j.heliyon.2020.e05235

Hasan, M., Le, T., & Hoque, A. (2021). How does financial literacy impact on inclusive finance? Financial Innovation, 7(1). https://doi.org/10.1186/s40854-021-00259-9

Ishikawa, K. (2021). The ASEAN Economic Community and ASEAN economic integration. Journal of Contemporary East Asia Studies, 10(1), 24–41. https://doi.org/10.1080/24761028.2021.1891702

Janssens, W., Pradhan, M., de Groot, R., Sidze, E., Donfouet, H. P. P., & Abajobir, A. (2021). The short-term economic effects of COVID-19 on low-income households in rural Kenya: An analysis using weekly financial household data. World Development, 138. https://doi.org/10.1016/j.worlddev.2020.105280

Javaid, M., Haleem, A., Singh, R. P., Suman, R., & Khan, S. (2022). A review of Blockchain Technology applications for financial services. BenchCouncil Transactions on Benchmarks, Standards and Evaluations, 2(3), 100073. https://doi.org/10.1016/j.tbench.2022.100073

Kling, G., Pesqué-Cela, V., Tian, L., & Luo, D. (2022). A theory of financial inclusion and income inequality. The European Journal of Finance, 28(1), 137–157. https://doi.org/10.1080/1351847X.2020.1792960

Kokorović Jukan, M., Okičić, J., & Hopić, D. (2020). Remittances as an opportunity to increase savings and financial inclusion of youth in South East Europe. Economic Research-Ekonomska Istrazivanja, 33(1), 2606–2619. https://doi.org/10.1080/1331677X.2020.1749104

Koomson, I., Villano, R. A., & Hadley, D. (2020). Effect of financial inclusion on poverty and vulnerability to poverty: Evidence using a multi-dimensional measure of financial inclusion. Social Indicators Research, 149, 613–639. https://doi.org/10.1007/s1120501902263-0.

Le, T. D., & Ngo, T. (2020). The determinants of bank profitability: A cross-country analysis. Central Bank Review, 20(2), 65–73. https://doi.org/10.1016/j.cbrev.2020.04.001

Lee, Y. S., Chia, M., & Komar, J. (2022). A Systematic review of physical activity intervention programs in ASEAN countries: Efficacy and future directions. International Journal of Environmental Research and Public Health, 19(9), 5357. https://doi.org/10.3390/ijerph19095357

Liu, D., Zhang, Y., Hafeez, M., & Ullah, S. (2022). Financial inclusion and its influence on economic-environmental performance: Demand and supply perspectives. Environmental Science and Pollution Research, 29, 58212–58221. https://doi.org/10.1007/s11356-022-18856-1

Midões, C., & Seré, M. (2022). Living with reduced income: An analysis of household financial vulnerability under COVID-19. Social Indicators Research, 161, 125–149. https://doi.org/10.1007/s11205-021-02811-7

Nguyen, H. V., Ha, G. H., Nguyen, D. N., Doan, A. H., & Phan, H. T. (2022). Understanding financial literacy and associated factors among adult population in a low-middle income country. Heliyon, 8(6), 1–12. https://doi.org/10.1016/j.heliyon.2022.e09638

Nguyen, M.-L. T., & Bui, T. N. (2021). Trade openness and economic growth: A study on Asean-6. Economies, 9(3), 113. https://doi.org/10.3390/economies9030113

Nguyen, T. T. H. (2020). Measuring financial inclusion: A composite FI index for the developing countries. Journal of Economics and Development, 23(1), 77–99. https://doi.org/10.1108/JED-03-2020-0027

Nguyen, Y. H. D., & Ha, D. T. T. (2021). The effect of institutional quality on financial inclusion in ASEAN countries. The Journal of Asian Finance, Economics, and Business, 8(8), 421–431. https://doi.org/10.13106/jafeb.2021.vol8.no8.0421

Nurhayati, I., Endri, E., Riani, D., & Bimo, W. A. (2022). Community’s potential and preferences for Islamic banking: The case of Indonesia. WSEAS Transactions on Environment and Development, 18, 1094–1105. https://doi.org/‌10.37394/‌‌‌232015.‌‌2022.18.104

Obinna, O. (2020). Impact of interest rate deregulation on investment growth in Nigeria. International Journal of Economics and Financial Issues, 10(2), 170–180. https://doi.org/10.32479/ijefi.9260

Omar, M. A., & Inaba, K. (2020). Does financial inclusion reduce poverty and income inequality in developing countries? A panel data analysis. Journal of Economic Structures, 9, 37. https://doi.org/10.1186/s40008-020-00214-4

Ozili, P. K. (2020, Jan 30). Financial inclusion research around the world: A review. SSRN. https://ssrn.com/abstract=3515515

Ozili, P. K. (2021, Mar 21). Has financial inclusion made the financial sector riskier? SSRN https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3768963

Pandhit, T. S. L. (2020). Dynamic financial inclusion in ASEAN 8: Do macroeconomics and financial technology matter? Jurnal Ekonomi & Studi Pembangunan, 21(2), 146-160. https://doi.org/10.18196/jesp.21.2.5037

Papageorge, N. W., Zahn, M. V., Belot, M., van den Broek-Altenburg, E., Choi, S., Jamison, J. C., & Tripodi, E. (2021). Socio-demographic factors associated with self-protecting behavior during the Covid-19 pandemic. Journal of Population Economics, 34(2), 691–738. https://doi.org/10.1007/s00148-020-00818-x

Pham, M. H., & Doan, T. P. L. (2020). The impact of financial inclusion on financial stability in Asian countries. The Journal of Asian Finance, Economics and Business, 7(6), 47–59. https://doi.org/10.13106/JAFEB.2020.VOL7.NO6.047

Raimi, L., Panait, M., & Hysa, E. (2021). Financial inclusion in ASEAN Countries – A gender gap perspective and policy prescriptions. LUMEN Proceedings, 15, 38-55. https://doi.org/10.18662/lumproc/gekos2021/4

Ratnawati, K. (2020). The Impact of Financial Inclusion on Economic Growth, Poverty, Income Inequality, and Financial Stability in Asia. The Journal of Asian Finance, Economics and Business, 7(10), 73–85. https://doi.org/10.13106/jafeb.2020.vol7.no10.073

Siano, A., Raimi, L., Palazzo, M., & Panait, M. C. (2020). Mobile banking: An innovative solution for increasing financial inclusion in sub-Saharan African countries: Evidence from Nigeria. Sustainability, 12(23), 10130. https://doi.org/10.3390/su122310130

Su, J., Su, K., & Wang, S. (2021). Does the digital economy promote industrial structural upgrading?—A test of mediating effects based on heterogeneous technological innovation. Sustainability, 13(18), 10105. https://doi.org/10.3390/su131810105

Thach, N. N., & Ngoc, B. H. (2021). Impact of economic freedom on corruption revisited in ASEAN countries: A Bayesian hierarchical mixed-effects analysis. Economies, 9(1), 3. https://doi.org/10.3390/economies9010003

Vo, D. H., Nguyen, N. T., & Thi-Hong Van, L. (2021). Financial inclusion and stability in the Asian region using bank-level data. Borsa Istanbul Review, 21(1), 36–43. https://doi.org/10.1016/j.bir.2020.06.003

Wang, J., Dong, K., Dong, X., & Taghizadeh-Hesary, F. (2022, Apr 11). Assessing the digital economy and its carbon-mitigation effects: The case of China. SSRN. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4080737

Wong, T. L., Lau, W. Y., & Yip, T. M. (2020). Cashless payments and economic growth: Evidence from selected OECD Countries. Journal of Central Banking Theory and Practice, 9, 189–213. https://doi.org/10.2478/jcbtp-2020-0028

Xu, Y., Ghose, A., & Xiao, B. (2018, November 12). Mobile payment adoption: An empirical investigation of Alipay. SSRN. https://ssrn.com/abstract=3270523

Zheng, S. Y., Sheng, B., Ghafoor, A., Ashraf, A. A., & Qamri, G. M. (2023). Investigating the environmental externalities of digital financial inclusion and the COVID-19 pandemic: An environmental sustainability perspective. Environmental Science and Pollution Research, 30(33), 80758–80767. https://doi.org/10.1007/s11356-023-27433-z