Assessing the Impact of Financial Technology on Income Inequality: An Empirical Analysis Using Gini Coefficient and Theil Index

This study explores how FinTech might be a transformative factor in income inequality and presents an empirical analysis using the Gini coefficient and Theil index across multiple economies. Against the backdrop of the rapid proliferation of digital financial services, this research investigates whether FinTech catalyzes economic equality or contributes to widening disparities. Using a Difference-in-Differences analysis of comprehensive datasets—including fourteen temporal indicators relating FinTech penetration to changes in income inequality metrics—preliminary results show that the effect of FinTech on income distribution is heterogeneous and highly sensitive to regional and socio-economic contexts. These results highlight the complexity of the interrelationship between technological development and economic outcomes, posing challenges for policymakers and other stakeholders in the FinTech ecosystem. By highlighting areas where FinTech has succeeded and failed, this research contributes to the ongoing debate on how technology can create a more inclusive financial system. The findings have fundamental implications for the formulation of specific policies that leverage the potential of FinTech to facilitate reductions in income inequality worldwide.