Does Banking Accessibility Matter in Assuring the Economic Growth in the Digitization Context? Evidence from Central and Eastern European Countries

Abstract

The purpose of this paper is to investigate the nexus between financial (banking) accessibility and economic growth in the context of the digitization process. Thus, we built a panel model to evaluate the correlations between the banking accessibility and economic growth during 2010–2021 period for the Central and Eastern European Countries (CEEC). Furthermore, we applied the Fully Modified Ordinary Least Squares (FMOLS) method with eight independent variables measuring the degree of banking accessibility and the dependent variable for economic growth. The results show that improving financial accessibility positively influences economic growth and greater access to banking services does not necessarily stimulate economic growth. In the digitization context, the results are relevant for the policymakers outlining that investing more in digitization is important, but this does not necessarily help people to have more access to banking services because there is also a lack of will and financial education that restrain them from embracing the digital changes.