Abstract:
There has been a call on policy makers in the African continent to
formulate and implement initiatives that help to realise some of the SDGs.
This is due to the low performance of the continent in terms meeting the
targets of the SDGs. In view of this, the study sought to investigate the
relationship between financial outreach, innovation and sustainable
development in Africa. Data was collected on 34 African economies for a
period of 10 years spanning from 2011 to 2020. The study employed the Twostep
System Generalised Method of Moments technique to estimate the
results. It was discovered that, depending on the indicator used to measure
outreach, financial outreach has significant positive and negative relationship
with sustainable development. On the various dimensions, financial outreach
had negative influence on carbon dioxide emissions, positive impact on
economic sustainability and inverse relationship with social sustainability. It
was also revealed that financial innovation has a significant negative link with
sustainable development in Africa. Additionally, the findings revealed that
both financial outreach and innovation serve as moderating variables in the
finance/development nexus. The study recommends that governments and
policy makers in various African countries work together with financial
service providers to ensure fair, flexible, and alluring interest rates on loans to
the underprivileged, disadvantaged ones in the society, and vulnerable
businesses in order to smooth their consumption and boost their businesses.
