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Do financial technology firms influence bank performance?

journal contribution
posted on 31.03.2021, 05:38 by Dinh Phan, PK Narayan, RE Rahman, AR Hutabarat
© 2019 Elsevier B.V. We develop a hypothesis that the growth of financial technology (FinTech) negatively influences bank performance. We study the Indonesia market, where FinTech growth has been impressive. Using a sample of 41 banks and data on FinTech firms, we show that the growth of FinTech firms negatively influences bank performance. We test our hypothesis through multiple additional tests and robustness tests, such as sensitivity to bank characteristics, effects of the Global Financial Crisis, and the use of alternative estimators. Our main conclusion that FinTech negatively predicts bank performance holds.

History

Publication Date

01/09/2020

Journal

Pacific-Basin Finance Journal

Volume

62

Article Number

101210

Pagination

13p. (p. 1-13)

Publisher

Elsevier

ISSN

0927-538X

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