Economic growth and the FDI-Fintech Nexus: A Cross-Country Perspective

PHAM THI NGOC DUNG

Email: [email protected]

Institute of Innovation, College of Technology and Design, University of Economics Ho Chi Minh City

PHAM MANH DUNG

Email: [email protected]

University of Economics Ho Chi Minh City

Abstract

This study examines the interaction effect between foreign direct investment (FDI) and financial technology (Fintech) development on economic growth, using data from 22 developed and 16 developing economies over the period 2011-2021. The findings highlight distinct dynamics across different economic contexts. In developing economies, FDI contributes to short-term growth by addressing capital and infrastructure gaps; however, its long-term impact diminishes in the absence of strong institutional support. While Fintech alone exhibits no immediate effect, its interaction with FDI produces delayed positive impacts, becoming statistically significant after one to two years as structural adjustments occur. In contrast, in developed economies, the contribution of FDI is limited, and Fintech development shows a weak negative relationship with growth over time, largely due to regulatory misalignments and market disruptions. The FDI-Fintech interaction in these economies further reflects inefficiencies and resource saturation, leading to delayed adverse effects on growth. These findings underscore the importance of context-specific policies to effectively harness the complementarities between FDI and Fintech in promoting sustainable economic growth.

Keywords: Fintech, FDI, economic growth

(This article was published in the Vietnam Economic&Financial Review, Vol 2, Issue 2, April 2026)

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