Digital Innovation, Fintech, and Sustainable Economic Development: A Public Administration Perspective
Abstract
Financial technology (FinTech) is rapidly transforming global economies. Digital transactions in emerging economies surged from 55 per adult in 2017 to 251 per adult by 2024, while 62% of adults in low- and middle-income countries now make or receive digital payments. However, realizing FinTech's benefits for sustainable development depends critically on the institutional capacity of public administration. This paper examines how public administration can leverage digital innovation and FinTech to achieve sustainable economic development, focusing on regulatory governance, digital infrastructure, and inclusive service delivery. Adopting a conceptual and policy analysis using a quantitative approach, the study reviews literature, policy frameworks, and empirical data from the IMF Financial Access Survey spanning 2004–2024 across 163 economies. The study is anchored on Institutional Theory and Public Value Theory. Fixed-effects panel regression and mediated moderation analysis were employed to test hypothesized relationships. Results indicate that FinTech adoption exerts a significant positive influence on sustainable economic development, while regulatory governance significantly moderates this relationship. Digital infrastructure significantly mediates the FinTech–development nexus (indirect effect. Public administrative capacity significantly improves inclusive service delivery, whereas algorithmic bias in credit screening significantly widens income inequality. Public-private partnerships significantly strengthen economic resilience. The study concludes that proactive governance, ethical oversight, and strong public-private partnerships are indispensable. It advocates for an agile governance model wherein public administrators utilize FinTech as a strategic asset for economic resilience and social justice. Policy recommendations for public sector leaders navigating digital transformation are offered.