Abstract

This study is aimed to discuss how financial technology (Fintech) influences financial inclusion along with pricing and cost reduction of banking services. It then examines how financial inclusion mediates this Fintech reduced banking cost relationship. Using an inductive approach, the study has reviewed and analysed prior research on financial inclusion, Fintech and banking cost efficiency to develop a solid theoretical framework. Here the analysis is both inductively derived through the empirical analysis data, as well as deductively created through the application of accredited theories and general principles that lead to specific conclusions or validate hypotheses. These findings show that Fintech increases financial inclusion by facilitating easier access to finances for different social groups, as well as increasing transparency, reducing information asymmetry and providing for security and privacy. Moreover, Fintech also diminishes the banking cost in Saudi banks by creating cheaper and more efficient financial transactions in addition to assisting faster and safer trade finance operations. Fintech also fosters financial inclusion minimizing costs further by excluding intermediaries, cutting the infrastructure cost and directly utilizing the digital wallet for transactions without any extra charges levied.