The main objective of this research is to investigate the effect of financial inclusion on banking financial performance. The researcher used the deductive and quantitative method to present the conceptual framework for financial inclusion and Egyptian banking performance. The researcher used Two-stage least-squares regression to analyze data collected the annual reports of the Egyptian Central bank related to the banking sector. The population for this study comprised of the 38 banks in Egypt. Secondary data was obtained from the reports published by the Central Bank of Egypt (CBE) which aggregates the financial soundness indicators of the Egyptian banking sector in the period from 2011 till December 2020. The results of the study showed that there is a significant positive effect of the financial inclusion indicators in terms of number of Branches, Number of Debit Cards, Number of Credit Cards, Number of ATMS, and Banking Density, on the dependent variable of the Profitability construct, at a significant level less than (0.05), but we have also a significant negative effect of the financial inclusion indicators in terms of Number of Debit Cards, Number of Credit Cards, Number of ATMS, and Number of Points of Sale on the dependent variable of the Liquidity construct, at a significant level less than (0.05). This validates partially the research hypothesis; There is a significant effect of the financial inclusion on banking performance in terms of the Profitability and Liquidity Indicators.