<p>Exploring how Islamic banks contribute to poverty reduction, an area previously given little attention, extends the examination of the direct influence that credit and savings have on poverty alleviation. We argue that financial technology (fintech) can be a vital moderating factor in the relationship between Islamic banks’ total assets and poverty alleviation efforts. We employed three scenarios of regression analysis, namely, direct, moderation, and marginal effects, in examining balanced panel data from Islamic banks operating in developing countries from 2014 to 2020. Our analysis accounted for various factors such as economic growth, political instability, and legal origin. Our findings reveal a significantly negative correlation between total assets held by Islamic banks and the poverty rate within each country. We observed that using fintech, particularly the technology adoption index among the population, moderated this relationship. Conversely, although a robust and stable economy positively affected poverty reduction, legal origin did not directly influence this outcome. These results underscore the importance of integrating advancements in fintech into poverty alleviation strategies, particularly for policymakers in developing countries. Our study contributes original insights by comprehensively examining pertinent variables within the context of empirical research. We anticipate that our findings will resonate with scholars and policymakers in finance, economics, and development studies, offering valuable guidance for initiatives that foster development, including those outlined in Saudi Arabia’s Hail development plans.</p>