Regulating FinTech Innovation for Gender-Inclusive Financial Systems: Legal Perspectives on Digital Payments, Consumer Protection, and Socioeconomic Barriers to Financial Inclusion

FinTech Regulation, Financial Inclusion, Gender Gap, Digital Payments, Customer Due Diligence, Consumer Protection, Global Findex, Know Your Customer.

Digital financial services have driven the most significant expansion of global financial inclusion in a generation, yet the legal and regulatory frameworks governing this expansion, anti-money laundering and customer due diligence rules, consumer protection regimes, and digital identity requirements, were designed principally around integrity and stability objectives rather than gender-equity objectives, producing a persistent gender gap in account ownership and account usage that regulation has only unevenly addressed. This paper examines the legal and regulatory dimensions of FinTech-enabled financial inclusion through a gender lens, drawing on the World Bank's Global Findex Database, Financial Action Task Force (FATF) guidance on anti-money laundering and financial inclusion, and comparative national case evidence, most notably India's shift to electronic know-your-customer (e-KYC) verification and its documented effect on closing the domestic gender gap in account ownership. The review examines three legal and regulatory dimensions of the gender-inclusion challenge: identity-verification requirements under the FATF's risk-based customer due diligence framework, which have been shown to disproportionately exclude women lacking formal identification documents; consumer protection and digital payment regulation governing the trust and safety of mobile money and digital wallet products through which the majority of newly included women access financial services; and the socioeconomic and legal barriers, including unequal property and inheritance rights, mobile phone ownership gaps, and digital literacy disparities, that regulation alone cannot resolve but that regulatory design can either mitigate or reinforce. A comparative methodology is applied using Global Findex account-ownership and gender-gap data across multiple reporting cycles (2017, 2021, 2024), FATF risk-based approach and tiered customer due diligence guidance, and national regulatory case studies. Reported findings indicate that the global gender gap in financial account ownership narrowed from 9 percentage points in 2017 to 6 points in 2021 before rising to 73% account ownership for women in low- and middle-income economies by 2024, a 7-point increase since 2021, but that roughly 700 million women worldwide remain unbanked, and that regulatory reforms enabling simplified or tiered due diligence, rather than digital payment innovation alone, are the specific legal mechanism most directly and causally linked to documented gender-gap closure in jurisdictions such as India. The paper concludes by discussing the continuing legal tension between financial-integrity regulation and inclusion objectives, and the socioeconomic barriers, mobile phone and smartphone ownership gaps, unequal identification access, and account usage gaps, that persist even where account-ownership gaps have substantially closed.