Financial Development Factors Influencing Corruption Perceptions in European Union Countries

Objective: Identify the factors that shape perceptions of corruption in European Union countries, with particular attention to financial inclusion and press freedom. Design/Methodology/Approach: Quantitative analysis was conducted using data from 27 EU member states, splitting the data into those that joined before and after 2004. In the regression models, financial inclusion indicators-digital transactions and online banking-along with press freedom indices, were checked against perception regarding corruption. Results: These findings imply that while financial inclusion, for example, through digital banking services, decreases perceived corruption, its impact is rather moderate compared to other structural factors, such as press freedom. The higher the level of press freedom, the greater the levels of societal transparency and accountability, leading to lower perceptions of corruption. Research Implications: The study underscores the need for structural reforms that promote institutional transparency and the media’s independence. Financial technologies can only supplement robust governance frameworks and boost efforts to fight against corruption. Originality/Value: This paper compares the factors that determine corruption within the European Union, integrating financial innovation and institutional transparency. The outcomes provide the policy-making sphere with realistic recommendations for implementing concrete anti-corruption measures.