The development of financial inclusion in Iran requires whether there are spatial spillover effects between regions? In this paper, the spatial effects of financial inclusion on income inequality in the provinces of Iran were estimated. A two-stage principal component analysis method was used to measure the financial inclusion index of the provinces. The local and spillover effects of financial inclusion on income inequality in the provinces of Iran were estimated using spatial error, spatial lag, spatial autocorrelation, and spatial durbin methods. For this purpose, data from 31 provinces of Iran were collected during the period 2011-2021. The results showed that the financial inclusion index is not in a good condition in any of the provinces. This index is at a moderate level in Tehran province and at a low level in 30 other provinces. The results of the estimation of spatial models indicate that financial inclusion has a negative and significant effect on the Gini coefficient in the provinces of Iran. In both spatial lag and spatial durbin models, the effect of the Gini coefficient with spatial lag (ρ) is positive and significant, which indicates that as the Gini coefficient increases in a province, income distribution in neighboring provinces is getting worse. The local effect of financial inclusion on income inequality is also negative and significant in Iranian provinces. Also, the spatial spillover effects of financial inclusion on the Gini coefficient are negative and significant only in the spatial lag model and negative but insignificant in the other two models. Therefore, the negative effect of financial inclusion on income inequality is confirmed locally, but its spillover effects are not sustainable. The effects of inflation and per capita income on the Gini coefficient are also positive and significant in all models. Therefore, it is suggested that policymakers pay special attention to developing infrastructure and improving the financial services network, especially in underserved areas.