| dc.description.abstract | Financial inclusion is a key pillar to global development. Several efforts have been put
in place across the globe to improve financial inclusivity levels. Despite the efforts, in
Kenya there is a considerable percentage who are yet to be financially included. Rural
women make up a majority of those who are financially excluded yet they are important
agents for transformational economic change. Several studies have concentrated on
individual variables in isolation in relation to financial inclusion. This study sought to
jointly analyze the influence of financial literacy and digital finance on financial
inclusion among rural women in Kenya. Specifically, it sought to assess the influence
of financial literacy on financial inclusion, investigate the role of digital finance on
financial inclusion, establish the interaction effect of financial literacy and digital
finance on financial inclusion and analyze rural women’s perspectives on financial
inclusion among rural women in Kenya. The study was anchored on the Financial
Literacy Theory, Social Learning Theory, Diffusion of Innovation Theory and the
Vulnerability Theories that helped address the objectives. A descriptive cross-sectional
research design was adopted to help gain an understanding on how the independent
variables; financial literacy and digital finance influenced financial inclusion among
rural women in Kenya at a specific point in time. The target population was rural
women in Kenya who were purposively selected from seven regions to represents
financial inclusivity in Kenya on a sample of 1000. The standard Global Findex
database as well as the FinAccess questionnaires were adopted and modified for
collection of primary data. Data was analysed using descriptive statistical analysis,
partial least square structural equation model (PLS – SEM) and Chi-square test of
Independence. The study revealed that financial literacy with a positive path coefficient
of 0.466, explains approximately 21.7% of the variance in financial inclusion, digital
finance explains (0.728) approximately 53.0% of the variation while digital literacy (a
combination of financial literacy and digital finance) explains up to 56.1% of the
variation in financial inclusion among rural women in Kenya. Rural women
perspectives were also found to explain about 18.7% of variance in financial inclusion.
Further analysis using the Chi-square revealed that there is a statistically significant
association between digital financial literacy and financial inclusion among rural
women in Kenya (χ2=397.64 >6.635). This study concludes that there is a strong
interconnection between financial literacy and digital finance where both play a pivotal
role in determining the level of financial inclusion among rural women. It adds that
while challenges exist, there are clear opportunities for intervention and improvement
and that the success of financial inclusion initiatives will depend on addressing both the
knowledge and behavioral gaps identified in this study. The study recommends
designing of localized financial literacy programs for understanding of basic financial
concepts, enhancing digital infrastructure and accessibility, creation of awareness on
financial products and services and creation of targeted interventions that will build
trust on digital financial services among rural women in Kenya. | en_US |
