Reducing Health Gaps Through Digital Finance: Panel Evidence from Asian Countries

Achieving universal health and well-being remains a formidable challenge across Asia, where disparities in healthcare access and affordability persist despite rapid economic growth. This study investigates whether digital financial inclusion (DFI) can serve as a catalyst for improved health outcomes in 31 Asian economies from 2000 to 2023. We construct a composite DFI index through principal component analysis, integrating five indicators of digital connectivity and financial access. The empirical strategy employs three-stage least squares and dynamic panel system generalized method of moments estimators to address endogeneity, simultaneity and unobserved heterogeneity, complemented by panel quantile regression to examine distributional effects. Three health indicators serve as dependent variables across separate models: infant mortality rate, life expectancy (LE) at birth and hospital beds (HBs) per 1,000 people. The findings consistently demonstrate that DFI exerts a statistically significant beneficial effect on all three health outcomes. Higher DFI is associated with lower infant mortality, longer LE and increased HB availability. These results remain robust across estimation techniques, model specifications and distributional quantiles. Among the control variables, health expenditure and economic growth are consistently significant determinants of health improvements, whereas inflation adversely affects health outcomes. The study contributes to the literature by offering novel cross-country evidence on the DFI–health nexus in Asia and by employing a methodological triangulation approach that strengthens causal inference. The findings carry important policy implications. Governments should integrate DFI strategies into public health frameworks, particularly in underserved and rural populations.