摘要：Interest in promoting financial inclusion has increased dramatically in recent years all over the world. The aim of this study is to empirically assess the impact of financial inclusion on the inflation rate in 37 developing countries for a period of 10 years from 2009 to 2018. Initially, Principal Component Analysis (PCA) has been utilized to construct a new multidimensional Financial Inclusion Index (FII) using three dimensions; access, usage, and quality of financial services. Next, 2 step system, Generalized Method of Moments (GMM) was applied to assess the impact of financial inclusion on the inflation rate empirically. The study established that an increased level of financial inclusion has an impact on decreasing the inflation rate in developing countries. It was also found that interest r and official reserves have a significant positive impact on inflation rate. These findings recommend that the policymakers in developing countries should consider financial inclusion as a tool for decreasing the inflation rate and accordingly boost the level of financial inclusion in their countries. Broadening financial inclusion to the informal sector and the rural areas could help in promoting the status of financial inclusion in developing countries.
