DIGITAL FINANCE AND PUBLIC POLICY: LESSONS FROM ECONOMICS FOR THE COMMON GOOD FOR THE ERA OF FINANCIAL INNOVATION

Öz

The rapid growth of the global digital economy, driven by technological advancements and broader internet accessibility, has transformed financial services through digital innovation. This study examines the role of public policy in supporting responsible digital financial innovation for the common good. Drawing on principles from Jean Tirole's Economics for the Common Good, the research highlights the importance of balanced policies that foster innovation while maintaining financial stability and inclusivity. Employing a systematic literature review, this research identifies best practices for integrating public policy with digital financial systems. This study provides several key recommendations. First, strengthening digital inclusion offering incentives to service providers to extend their reach to remote areas. Second, regulatory technology adopting technology to enhance regulatory oversight and monitoring. Thrid, financial education and literacy enhancing public understanding of digital financial services. Fourth, global collaboration and establishing international regulations to address cross-border risks such as money laundering and data breaches.

Anahtar Kelimeler

• Digital Finance
• Public Policy
• Common Good

DIGITAL FINANCE AND PUBLIC POLICY: LESSONS FROM ECONOMICS FOR THE COMMON GOOD FOR THE ERA OF FINANCIAL INNOVATION

Öz

The rapid growth of the global digital economy, driven by technological advancements and broader internet accessibility, has transformed financial services through digital innovation. This study examines the role of public policy in supporting responsible digital financial innovation for the common good. Drawing on principles from Jean Tirole's Economics for the Common Good, the research highlights the importance of balanced policies that foster innovation while maintaining financial stability and inclusivity. Employing a systematic literature review, this research identifies best practices for integrating public policy with digital financial systems. This study provides several key recommendations. First, strengthening digital inclusion by offering incentives to service providers to extend their reach to remote areas. Second, regulatory technology adopts technology to enhance regulatory oversight and monitoring. Thrid, financial education and literacy enhance public understanding of digital financial services. Fourth, global collaboration and establishing international regulations to address cross-border risks such as money laundering and data breaches.

Anahtar Kelimeler

• Digital Finance
• Public Policy
• Common Good

Kaynakça

1. Anakpo, G., Xhate, Z., & Mishi, S. (2023). The Policies, Practices, and Challenges of Digital Financial Inclusion for Sustainable Development: The Case of the Developing Economy. FinTech, 2(2), 327–343. https://doi.org/10.3390/fintech2020019
2. Brika, S. K. M. (2022). A Bibliometric Analysis of Fintech Trends and Digital Finance. Frontiers in Environmental Science, 9(January), 1–10. https://doi.org/10.3389/fenvs.2021.796495
3. Daud, I., Nurjannah, D., Mohyi, A., Ambarwati, T., Cahyono, Y., Haryoko, A. D. E., Handoko, A. L., Putra, R. S., Wijoyo, H., Ari-Yanto, A., & Jihadi, M. (2022). The effect of digital marketing, digital finance and digital payment on finance performance of indonesian smes. International Journal of Data and Network Science, 6(1), 37–44. https://doi.org/10.5267/J.IJDNS.2021.10.006
4. Idrus, A. (2024). Exploring Public Finance Policies: A Qualitative Inquiry into Fiscal Policy Analysis, Government Financial Management, and Public Sector Financial Health. Golden Ratio of Finance Management, 4(2), 87–99. https://doi.org/10.52970/grfm.v4i2.481
5. Indrayani, E. (2023). Integrasi Sistem Layanan Digital (Issue January).
6. Kayani, U., & Hasan, F. (2024). Unveiling Cryptocurrency Impact on Financial Markets and Traditional Banking Systems: Lessons for Sustainable Blockchain and Interdisciplinary Collaborations. Journal of Risk and Financial Management, 17(2). https://doi.org/10.3390/jrfm17020058
7. Li, Q., & Zhang, X. (2024). Digital finance development in China: A scientometric review. Heliyon, 10(16), e36107. https://doi.org/10.1016/j.heliyon.2024.e36107
8. Luo, D., Luo, M., & Lv, J. (2022). Can Digital Finance Contribute to the Promotion of Financial Sustainability? A Financial Efficiency Perspective. Sustainability (Switzerland), 14(7). https://doi.org/10.3390/su14073979