Assessing bank financial performance in the context of digital financial service policy: empirical insights

What is it about?

The Digital Financial Services Policy (DFSP) was initiated by the Ghana Ministry of Finance in 2020, to promote the use of digital financial services by financial institutions to achieve financial inclusion. This study examines the impact of the DFSP on bank financial performance Ghanaian universal banks . The study finds that DFSP positively impacts return on assets and return on equity. Additionally, adopting DFSP in Ghana has levelled the playing field for both large and small banks, as well as for listed, non-listed, domestic, and foreign-owned banks, supporting the financial inclusion theory's benefits associated with banks. However, DFSP negatively impacts the net interest margin.

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