Constructing a FinTech Adoption Index for BRICS+ Economies: Evidence from Principal Component Analysis

Using Principal Component Analysis (PCA), this study creates a composite FinTech Adoption Index for eleven BRICS+ economies between 2006 and 2024. The index captures key dimensions of financial and digital infrastructure through four indicators: Automated Teller Machines (ATMs) per 100,000 adults, mobile cellular subscriptions per 100 people, fixed broadband subscriptions per 100 people, and individuals using the internet as a percentage of the population. The World Development Indicators (WDI) database is the source of data for every indicator. The BRICS+ economies differ significantly from one another in terms of the development of digital and financial infrastructure, as shown by descriptive statistics. The correlation analysis indicates moderate-to-strong positive relationships among all four indicators, supporting their suitability for PCA. The findings demonstrate a distinct upward trend in FinTech adoption throughout the BRICS+ economies between 2006 and 2024, emphasising the growing contribution of financial infrastructure and digital connectivity to the advancement of financial technology.