Unequal Resilience: Exploring the Determinants of Financial Resilience in South Asia

Abstract

The objective of the study is to assess the impact of socioeconomic, regional, demographic, and contextual factors on financial resilience in South Asia. The research utilizes data from the 2021 Global Findex database. For empirical analysis, the sample consists of 8,009 participants from six South Asian countries, excluding Bhutan and Maldives. The study employs a logistic regression model to examine the relationship between these factors and financial resilience. The baseline regression findings reveal that financial resilience is significantly influenced by gender, education, income, digital access, and place of residence. Males demonstrate a higher likelihood of being financially resilient than females, reflecting enduring gender-based disparities in financial inclusion. Education, especially at the tertiary level, emerges as a strong predictor of resilience, while income shows a clear, monotonic relationship—higher income groups are markedly more resilient. Digital access, particularly the combination of mobile and internet connectivity, significantly enhances financial preparedness, whereas single access point yield limited benefits. Urban residents are more financially resilient than their rural counterparts, likely due to better infrastructure and diversified income opportunities. The findings of the study are crucial for policymakers and financial institutions aiming to enhance financial resilience, thereby improving economic stability and promoting mental well-being in a region marked by significant disparities.