Impact of Financial Technology on Credit Accessibility in Emerging Markets: A Comparative Analysis

Abstract

The rise of financial technology (Fintech) has fundamentally altered the dynamics of accessing credit in emerging markets, providing new ways to close the gap in financial inclusion. This paper examines the way in which Fintech providers – scaling digital identity systems, AML, alternative credit scoring, and mobile-based interfaces – are reconfiguring access to credit in underserved markets. Using a qualitative approach, it integrates a structured review with comparative case analysis of Kenya, India, and Nigeria, synthesizing peer reviewed and grey literature to assess the potential of Fintech in democratizing credit outcome using peer-reviewed evidence as well as institutional reports. The results show that Fintechs reduce overall cost, coverage, and time to deliver credit among especially informal workers, women, and microenterprises. Benefits, however, are very much dependent on enabling conditions such as legal and regulatory preparedness, digital infrastructure, and legal and security safeguards. It is theoretically based on Financial Intermediation Theory and Innovation Diffusion Theory, and provides a two-fold explanation for both the disintermediation of traditional credit as well as behavior mechanisms leading to Fintech usage. Policy and pragmatic considerations highlight the importance of adaptive governance regimes, ethical data stewardship, and multi-actor collaboration to ensure responsible scaling. It is also consistent with a number of Sustainable Development Goals (SDGs) – such as poverty reduction, gender equality, and economic growth. This research works as an empirically informed and context-specific analysis for the debate on inclusive digital finance and provides strategic implications for policy-makers, Fintech developers and development practitioners aspiring to nurture successful credit ecologies in the Global South.