Trust lies at the heart of every financial system. Whether implicit in traditional banking relationships or encoded in decentralized networks, it determines how individuals, institutions, and societies manage value and risk. A recent study published on SpringerLink proposes a new research agenda around “trust in fintech,” urging a closer look at how emerging technologies—such as decentralized finance (DeFi), artificial intelligence (AI), and open banking—reshape financial relationships. While much of this conversation takes place in developed markets, the question of trust carries particular urgency in lower-income and developing economies, where digital finance often advances faster than institutional safeguards.
Fintech’s rise has transformed access to credit, savings, and payments across the Global South. Between 2015 and 2024, mobile money accounts in Africa more than doubled, surpassing 600 million active users according to the GSMA. In Southeast Asia, digital wallets and peer-to-peer lending have extended basic financial services to millions who were previously unbanked. Yet, as the SpringerLink paper notes, access alone does not equal empowerment. Trust—the willingness to engage with systems perceived as fair, stable, and secure—remains the missing infrastructure of financial inclusion.
In mature economies, trust in fintech is typically mediated by regulation, data protection laws, and brand reputation. Users assume institutional accountability. In many developing economies, however, trust is more fragile. Weak consumer protection, limited digital literacy, and inconsistent regulatory oversight can turn fintech’s promise into a double-edged sword. Scams, predatory lending, and misuse of personal data have eroded public confidence in some regions, creating what economists describe as a “trust gap” between technological capacity and institutional credibility.
Kenya offers both a success story and a cautionary tale. M-Pesa, launched in 2007, became a global model for mobile financial inclusion. By enabling simple, SMS-based transactions, it built trust through accessibility, reliability, and strong local partnerships. Over time, M-Pesa evolved into an ecosystem for microloans, savings, and remittances. Yet, as the ecosystem expanded, so did concerns about data privacy and algorithmic bias in credit scoring. Studies from the University of Nairobi found that informal workers often faced hidden disadvantages in automated loan assessments due to limited transaction history—illustrating how algorithmic systems can replicate offline inequalities.
Trust also shapes macroeconomic outcomes. In countries where citizens distrust financial institutions, savings rates tend to remain low, and informal cash-based economies persist. The World Bank’s Global Findex 2024 report estimates that nearly one-third of adults in sub-Saharan Africa and South Asia still avoid formal banking due to concerns about transparency and security. This mistrust not only limits individual opportunity but also constrains capital formation and economic growth. Without trusted intermediaries, remittances, microloans, and digital credit—the building blocks of grassroots development—struggle to reach scale.
Artificial intelligence compounds this challenge. Many fintech firms in developing regions now use AI to automate credit scoring, fraud detection, and risk assessment. When well-designed, such systems can expand access by analyzing non-traditional data such as mobile usage or utility payments. However, without governance and local calibration, they can embed discrimination. Research by the Asian Development Bank shows that AI-driven credit models trained on incomplete or biased datasets tend to penalize rural or low-income applicants, reinforcing structural exclusion. The problem is not the technology itself but the absence of institutional trust mechanisms—transparency, redress, and accountability—that allow users to believe in its fairness.
Building trust in fintech therefore requires more than technological sophistication. It involves designing systems that respect local contexts and social contracts. The SpringerLink research agenda proposes three pillars for rebuilding financial trust: measurement, architecture, and governance. Measurement refers to quantifying trust—through surveys, behavioral data, and network analysis—to identify gaps between perception and performance. Architecture involves embedding trust mechanisms directly into fintech design, such as verifiable digital identities, open ledgers, and consent-based data sharing. Governance encompasses institutional and policy frameworks that ensure accountability and recourse when systems fail.
Case studies highlight how these principles are being implemented. In India, the Unified Payments Interface (UPI) succeeded not merely because of technological efficiency but because of trust architecture. UPI operates under a public-private framework managed by the National Payments Corporation of India (NPCI), guaranteeing interoperability and consumer protection. Transparency, low transaction costs, and state-backed regulation have turned UPI into a national utility. In contrast, Nigeria’s digital credit boom has faced setbacks due to insufficient oversight. Unregulated lenders using aggressive collection practices triggered a regulatory crackdown in 2023, eroding confidence in digital finance despite high adoption rates.
For low-income countries, trust in fintech carries broader social implications. It can directly influence poverty reduction by enabling micro-entrepreneurship, improving access to insurance, and supporting conditional cash transfers. In Bangladesh, digital financial inclusion programs such as bKash have reduced transaction costs for aid disbursement and improved household resilience. However, when platforms malfunction or appear opaque, beneficiaries quickly revert to cash. The fragility of trust remains a recurring theme—once broken, it can take years to rebuild.
Academic literature supports this link between trust and poverty alleviation. A 2024 study in the Journal of Development Economics found that communities with high trust in digital finance experience 15–20 percent higher small business formation rates than those without. Trust reduces perceived risk, encourages savings, and facilitates collective participation in formal economic systems. Inversely, distrust creates a “digital poverty trap,” where those excluded from trusted systems face compounding disadvantages in accessing credit, healthcare, and education.
Blockchain technology, often framed as “trustless,” paradoxically depends on new forms of distributed trust. In theory, decentralized finance reduces reliance on institutions by embedding transparency into code. In practice, however, DeFi adoption in developing economies remains limited by literacy, regulation, and volatility. The collapse of several high-profile crypto lending platforms between 2022 and 2023 demonstrated that algorithmic transparency is not a substitute for institutional integrity. What emerging economies need are hybrid models that combine decentralized verification with local accountability—where communities, regulators, and technologists share responsibility for ethical design.
A promising example comes from Rwanda’s Digital Public Infrastructure Initiative, which integrates open banking APIs with national ID systems to enhance transparency and financial access. By linking digital identities with consent-based data sharing, Rwanda has improved financial inclusion without compromising privacy. Similar initiatives in Ghana and Indonesia are showing that when citizens can verify and control their data, trust in digital ecosystems rises sharply. These approaches suggest that fintech’s greatest innovation may not be technological but institutional—building participatory frameworks that give users agency.
The long-term societal impact of trust-driven fintech extends beyond financial services. It shapes civic confidence, social cohesion, and institutional legitimacy. In societies where trust in government is low, fintech platforms can act as parallel governance systems, offering reliability and transparency that public institutions struggle to provide. Yet this substitution carries risks: private platforms may accumulate disproportionate influence over economic life without democratic accountability. The future of trust in fintech will depend on striking a balance—leveraging private innovation while ensuring public oversight.
To overcome the trust deficit in developing economies, researchers and policymakers increasingly advocate for “trust ecosystems”—collaborative models where governments, regulators, fintech firms, and civil society co-create governance norms. Initiatives such as the Alliance for Financial Inclusion and the OECD’s Digital Trust Framework emphasize interoperability, inclusion, and shared data standards as the building blocks of global trust infrastructure. The next stage of fintech development must embed ethics and empathy into design, ensuring that efficiency does not eclipse equity.
The paradox of fintech in the developing world is that it simultaneously democratizes and concentrates power. It enables millions to enter the formal economy but also exposes them to new forms of vulnerability. Rebuilding trust means recognizing that technology is not neutral—it reflects the values of its creators and the strength of the institutions that govern it. If the ICT revolution of the early 2000s connected the world, the fintech revolution of the 2020s must ensure that the connection is one of confidence, fairness, and dignity.
Key Takeaways
- Trust remains the most critical factor in fintech adoption, especially in developing economies where institutional safeguards are weak.
- Fintech can reduce poverty by expanding access to financial services, but mistrust and weak regulation can reverse these gains.
- AI and digital credit systems risk reinforcing inequality unless designed with transparency and local context.
- Successful trust-building requires coordinated frameworks of measurement, architecture, and governance.
- The future of fintech lies in hybrid trust ecosystems—combining technology with inclusive, accountable institutions.
Sources
- SpringerLink — Trust as a Central Research Domain in Fintech — Link
- World Bank — Global Findex Report 2024 — Link
- GSMA — State of Mobile Money 2025 — Link
- Asian Development Bank — AI and Financial Inclusion in Asia — Link
- Journal of Development Economics — Trust, Digital Finance, and Poverty Reduction — Link
- Alliance for Financial Inclusion — Global Trust Ecosystem Framework 2025 — Link
- OECD — Digital Trust Framework for Emerging Economies — Link
- University of Nairobi — Algorithmic Bias and Financial Access — Link
- National Payments Corporation of India — UPI Impact Study 2025 — Link
- Rwanda ICT Board — Digital Public Infrastructure Report 2025 — Link
