The Role of Digital Finance and Financial Inclusion in Enhancing Community Income: Evidence from the Pulau Ketam Forest Reserve Area, Kuala Perlis, Malaysia

This study examines the role of digital finance and financial inclusion in enhancing community income in the Pulau Ketam Forest Reserve Area, Kuala Perlis, Malaysia. Communities living in forest reserve and conservation-based areas often face limited access to formal financial services, which constrains income growth and economic resilience. Using a quantitative approach, this study collected primary data from 135 respondents comprising households and micro-entrepreneurs through structured questionnaires. Digital finance and financial inclusion were analyzed as independent variables, while community income served as the dependent variable. Data were analyzed using descriptive statistics, reliability tests, and multiple linear regression analysis. The findings reveal that digital finance has a positive and significant effect on community income, indicating that the use of mobile banking, digital payment systems, and fintech services contributes to income growth and stability. Financial inclusion is also found to have a positive and significant impact on community income, highlighting the importance of access to formal financial services such as savings accounts and credit facilities. The regression results show that digital finance and financial inclusion jointly explain a substantial proportion of the variation in community income. These findings suggest that inclusive digital financial systems can support livelihood enhancement while aligning with sustainable development objectives in forest reserve areas. The study provides important policy implications for promoting digital financial inclusion as a strategy for community empowerment and sustainable economic development in environmentally sensitive regions.