Financial Inclusion Access and Female Labour Participation in Sub‐Saharan Africa: The Moderating Role of Institutional Quality

ABSTRACT This study investigates the nexus between financial inclusion, institutional quality, and female labor force participation in sub‐Saharan Africa over the period 1990–2023. Using panel data for 43 countries and employing OLS, FGLS, and dynamic GMM estimators, the analysis examines whether access to financial institutions and financial markets promotes gender‐inclusive labor outcomes and evaluates the moderating role of institutional quality in shaping these effects. The findings demonstrate that access to financial institutions exerts a consistently positive and significant influence on women's labor force participation, whereas access to financial markets yields even negative effects. Governance indicators are negatively associated with female labor force participation when considered independently; however, their interaction with financial access significantly enhances the benefits of inclusion, underscoring the role of governance as an enabling institutional framework. Additional results highlight the role of structural factors. Healthcare costs reduce women's participation, while internet diffusion and economic growth promote inclusion. Education displays a negative association, reflecting a persistent enrolment–employment mismatch in the region. These findings are consistent across alternative estimation techniques, confirming their robustness. These findings highlight that institutional financial inclusion, supported by governance reforms, is central to women's empowerment and directly contributes to SDG 5 (gender equality), SDG 8 (decent work and economic growth), and SDG 10 (reduced inequalities).