Investigating the role of Fintech in the banking industry: what do we know?

Elia, Gianluca; Stefanelli, Valeria; Ferilli, Greta Benedetta

doi:10.1108/ejim-12-2021-0608

Cited by 46 publications

(33 citation statements)

References 96 publications

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“…Second, it puts gender diversity (Bøhren and Staubo, 2016;Bennouri et al, 2018) research forward by spotlighting the usefulness of having independent women on board to oversight the provision of effective new business models that boost bank performance. Third, it contributes to the debate on the bright and the dark sides of financial innovations in banks (Beck et al, 2016) particularly enriching the nascent literature on Fintech innovation (Elia et al, 2022; EJIM 26,7 Lee et al, 2021;Zhao et al, 2022) with a finer understanding of the efficacy of in-house provisions of FinTech solutions versus the collaboration with external FinTech firms. We also provide practical implications by reinforcing the awareness of investors, government authorities and financial supervisors on the need for pro-innovation policies and initiatives.…”

Section: Introductionmentioning

confidence: 95%

Governing FinTech for performance: the monitoring role of female independent directors

Arena

Catuogno

Naciti

2023

EJIM

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PurposeThe use of digital technologies in the financial service industry has brought new complexities to the corporate governance in banks. Relying on the agency perspective of the shareholder, debtholder and societal governance in banks, this research examines the impact of financial technology innovation (FinTech) on banks' performance by enlightening the monitoring role of female independent directors.Design/methodology/approachRelying on a sample of Italian banks observed during the period 2016–2020, the authors hand-collected data on the use of FinTech by considering (1) the in-house provisions of FinTech solutions, (2) the collaboration with external FinTech firms and (3) a combination of both measures. The authors run a panel data regression analysis with fixed effects, measuring bank performance through bank competitiveness and bank riskiness.FindingsThe authors find that FinTech increases bank competitiveness in gathering money from depositors and that independent women on board mitigate the negative relationship between FinTech and the riskiness of banks' assets, ameliorating the conflicting interests among shareholders, debtholder and societal governance.Originality/valueThis study emphasizes the complexities of bank governance when dealing with FinTech in the wider perspective of equity governance, debt governance and the societal governance spotlighting the importance of appointing female directors in independent positions to enhance the bright sides of financial innovation. The authors enrich the literature on FinTech with a finer understanding of the drivers and implications of in-house provisions of FinTech solutions versus the collaboration with external FinTech firms.

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Section: Introductionmentioning

confidence: 95%

Governing FinTech for performance: the monitoring role of female independent directors

Arena

Catuogno

Naciti

2023

EJIM

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“…Fintech products increase bank risk, threatening the protection of customers and the efficiency and stability of the financial sector [15]. Fintech reduces the bank's transaction cost, improves bank efficiency, and improves financial business complexity.…”

Section: Literature Reviewmentioning

confidence: 99%

The Role of Fintech on Bank Risk-Taking: Mediating Role of Bank’s Operating Efficiency

Sajid

Ayub

Malik

et al. 2023

Human Behavior and Emerging Technologies

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Fintech revolutionized the traditional banking business models in emerging countries. The effect of fintech on banks’ operating efficiency and risk-taking behavior is still inconclusive. The study is aimed at exploring the effect of fintech products on banks’ operating efficiency and risk-taking behavior. The study used a quantitative research approach by collecting secondary data from annual reports of 50 commercial banks from emerging countries, namely, China, India, Pakistan, and Bangladesh, for the period 2014 to 2021. The study used panel data for path analysis and structural equation modeling (SEM) to test the theoretical mediation model by using STATA. The results show that the fintech product reduces the bank’s risk-taking behavior by enhancing the bank’s operating efficiency. The path analysis results show that operating efficiency mediates the relationship between fintech products and bank risk-taking behavior in emerging countries. The paper offers useful recommendations for central bank and commercial bank policymakers. The study is also beneficial for commercial banks that use fintech solutions to increase operational effectiveness and reduce risk. The study is the first empirical investigation into the connection between the growth of fintech products, bank operational effectiveness, and risk-taking behavior in developing nations.

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“…FinTech includes, besides CF, systems like cryptocurrencies and blockchain, new digital advisory and trading systems, artificial intelligence and machine learning, peer-to-peer lending and mobile payment systems, robot advisory, big data, and cloud computing (Cai, 2018; Elia et al ., 2022; Thakor, 2019).…”

Section: Theoretical Backgroundmentioning

confidence: 99%

“…This set of innovations like crowdfunding (CF), mobile payments, cryptocurrencies and blockchain became a challenging research area for management scholars, named Financial Technology (FinTech) (Elia et al ., 2022; Milian et al ., 2019; Thakor, 2019).…”

Section: Introductionmentioning

confidence: 99%

An exploration of the causal structure underlying crowdfunding: theoretical findings and practical implications

Linzalone

Ammirato

Felicetti

2023

EJIM

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PurposeCrowdfunding (CF) is a digital-financial innovation that, bypassing credit crisis, bank system rigidities and constraints of the capital market, is allowing new ventures and established companies to get the needed funds to support innovations. After one decade of research, mainly focused on relations between variables and outcomes of the CF campaign, the literature shows methodological lacks about the study of its overall behavior. These reflect into a weak theoretical understanding and inconsistent managerial guidance, leading to a 27% success ratio of campaigns. To bridge this gap, this paper embraces a “complex system” perspective of the CF campaign, able to explore the system's behavior of a campaign over time, in light of its causal loop structure.Design/methodology/approachBy adopting and following the document model building (DMB) methodology, a set of 26 variables and mutual causal relations modeled the system “Crowdfunding campaign” and a data set based on them and crafted to model the “Crowdfunding campaign” with a causal loop diagram. Finally, system archetypes have been used to link the causal loop structure with qualitative trends of CF's behavior (i.e. the raised capital over time).FindingsThe research brought to 26 variables making the system a “Crowdfunding campaign.” The variables influence each other, thus showing a set of feedback loops, whose structure determines the behavior of the CF campaign. The causal loop structure is traced back to three system archetypes, presiding the behavior in three stages of the campaign.Originality/valueThe value of this paper is both methodological and theoretical. First, the DMB methodology has been expanded and reinforced concerning previous applications; second, we carried out a causation analysis, unlike the common correlation analysis; further, we created a theoretical model of a “Crowdfunding Campaign” unlike the common empirical models built on CF platform's data.

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Investigating the role of Fintech in the banking industry: what do we know?

Cited by 46 publications

References 96 publications

Governing FinTech for performance: the monitoring role of female independent directors

Governing FinTech for performance: the monitoring role of female independent directors

The Role of Fintech on Bank Risk-Taking: Mediating Role of Bank’s Operating Efficiency

An exploration of the causal structure underlying crowdfunding: theoretical findings and practical implications

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