The growing popularity of smartphones and the proliferation of technology have accelerated the development of the digital payment industry. Fintech enables customers to access financial services more efficiently and faster than traditional business, especially during the COVID-19 pandemic due to...

We provide new evidence on the effects of competition on incumbents' innovative behavior by examining the rise of FinTech start-ups over the period 2000-2016. We employ machine learning techniques to classify a large global sample of patent applications into five FinTech categories. We exploit...

The contribution of financial and non-financial risks to the overall level of risk in the system depends on the current state of the EU banking system (which, in the aggregate and compared with banking sectors in other major advanced economies, cannot be characterised as strong) and how...

The financial-technology industry has recently attracted the attention of many sectors. The financial-technology industry designs new and unusual technological financial services in many areas. It combines technology with finance and provides an alternative to the traditional financial system....

We build a model with a traditional banking system, endogenous entry of firms and fintech intermediaries, and firm heterogeneity in credit access and usage to study the credit-market, macroeconomic, and business cycle implications of the recent sizable growth in the number of fintech...

Financial inclusion, defined as the adequate access and usage of formal financial services to improve people’s lives, is a crucial area for the economic development of a country through its various angles. This paper analyzes the impact of selected FinTech companies on financial inclusion in...

Chen et al. (2021) show that almost one-third of First Nations band offices in Canada are within 1 kilometre (km) of an automated banking machine (ABM) or financial institution (FI) branch and more than half are within 5 km. Further, over three-quarters of band offices are within 20 km of an ABM...

Recent literature has addressed initial coin offering (ICO) projects, which are an innovative form of venture financing through cryptocurrencies using blockchain technology. Many features of ICOs remain unexplored, leaving much room for additional research, including the success factors of ICO...

We ask whether epidemic exposure leads to a shift in financial technology usage and who participates in this shift. We exploit a dataset combining Gallup World Polls and Global Findex surveys for some 250,000 individuals in 140 countries, merging them with information on the incidence of...

This note examines the implications of digital innovation for market structure and attendant policies, including financial and competition regulation. There have been several surveys of regulatory responses. This note takes a step back, to look at what the economic theory of banking and...

Fintech is transforming the global financial landscape. It is creating new opportunities to advance financial inclusion and development in Emerging Markets and Developing Economies (EMDEs), but also presents risks that require updated supervision policy frameworks. Fintech encompasses new...

This note provides: (1) an overview of new manifestations of consumer risks that are significant and cross-cutting across four key fintech products: digital microcredit, P2PL, investment-based crowdfunding, and e-money; and (2) examples of emerging regulatory approaches to target such risks....

This technical note is structured in the following manner. Section two provides an overview of the main barriers and frictions that SMEs face to access finance. Section three explores how digitization is an enabler for SME finance and how different fintech solutions address these barriers. The...

The market for payments is an important two-sided one, where consumers benefit from increased merchant acceptance of payment cards and vice versa. The dependence between the decisions that are made on each side of the market results in various network externalities that are often discussed but...

Financial markets face the constant threat of cyber attacks. We develop a principal-agent model of cyber-attacking with fee-paying clients who delegate security decisions to financial platforms. We derive testable implications about clients' vulnerability to cyber attacks and about the fees...

Credit risk management has been always a prime concern for different stakeholders since it is the most critical of all risks faced by depository institutions (DIs). Since regulatory prerequisite imposed to cooperative society (CS) is not standard as imposed to banks by the central bank, a number...

The paper defines digital financial inclusion, and highlights the goal of digital financial inclusion, the components of digital financial inclusion, the providers of digital financial services, the instruments for digital financial inclusion, the benefits of digital financial inclusion, the...

This paper looks at consumer complaints about student loan lenders and servicers from the Consumer Financial Protection Bureau’s (CFPB’s) consumer complaint database. Using a novel dataset drawn from 30,678 complaints filed against 212 student loan companies, we analyze consumers’...

Fintech and decentralized finance have penetrated all areas of the financial system and have improved financial inclusion in the last decade. In this paper, we review the recent literature on fintech, cryptocurrencies, stablecoins, and central bank digital currencies (CBDCs). There are important...

This study empirically verifies whether the adoption of Enterprise Risk Management (ERM) impacts firms’ financial performance based on the perception of executive-level employees of Sri Lankan insurance companies. Two hundred thirty-six executive-level employees from 26 active Sri Lankan...

We show that as nonbanks' market share increases in a local residential mortgage market, the quality of mortgage services in the market improves. Two instrumental variable analyses exploiting (1) stress tests conducted by the Federal Reserve, and (2) mortgage industry surety bonds required by...

Data protection law has been one of the intensely discussed legal domains in relation to new data technologies such as Big Data and Machine Learning. Arguments have even been made that due to its wide scope (both material and personal), it may apply to everything and everyone. However, criticism...

Developing inclusive financial system is an important policy intervention to create opportunities for e economic development, reduce poverty and improve the livelihood of the poor. Despite the growing and focused research interest on financial inclusion, empirical findings on the role of...

Using a theoretical model that assumes heterogeneity in lenders' screening ability and in borrowers' investment horizon, we show that fintech loans to entrepreneurs are more likely to be unsecured and short-term while bank loans are expected to be asset-backed and long-term. The findings suggest...

Tracing its roots to the time of the second Caliph of Islam, Umar ibn al Khattab, may Allah, the Exalted, be pleased with him, Islamic finance is based on the core principles surrounding interest-free transactions and public benefit. It promotes risk-sharing and enforces economic equality. Over...

Abstract in German: Auf Basis eines bundesweiten Samples von Honorarberatern und Kunden eruiert diese Studie handlungspolitische Empfehlungen, die zu einer erfolgreichen Etablierung der Honorarberatung in Deutschland beitragen sollen. Mittels einer explorativen Faktoranalyse (EFA) wird zwischen...

“History repeats itself” is not just an idiom, it is the naked truth; another agonizing fact is that humans do not seem to have learned from past experiences throughout history. For instance, misleading or policy error by the Fed (unwarranted tight-money policy stance in the 1920s) was...

We assess the role of FinTech firms in loans made through the Paycheck Protection Program (PPP). The PPP program, created by the U.S. government as a response to the COVID-19 pandemic, provides loans to small businesses so they can keep employees on their payroll. We argue that FinTech firms’...

Nigeria has the most FinTech unicorns in Africa, with five out of the seven African unicorns being Nigerian companies, and two of three Nigerian unicorns for 2021, being FinTech companies. FinTech companies have gained much traction because of their successes in making financial products and...

Technology has changed how discrimination manifests itself in financial services. Replacing human discretion with algorithms in decision-making roles reduces taste-based discrimination, and new modeling techniques have expanded access to financial services to households who were previously...

We use data on granular holdings of debt and Credit Default Swaps (CDS) referencing non-financial corporations across financial investors, to investigate how CDS reallocate credit risk and whether this increases investor-level riskiness. To guide our investigation, we propose a methodology to...

Using new administrative data on all registered mortgage loan officers in the U.S. linked to the individual loan applications they process, we document three facts: (1) minority loan officers are under-represented in financial institutions, especially in small banks and shadow banks; (2) local...

We estimate the impact of the COVID-19 pandemic on credit risk changes on a large sample of Polish SME firms. The Altman Z"-Score model, which has proven to be a powerful and robust bankruptcy prediction model across many industries and countries, is used to assess over 1,000 SMEs from seven...

We build a financial intermediation model wherein bank and fintech intermediaries differ in their enforcement technology, reliance on collateral, and funding cost and compete or partner within frictional credit markets. The model explains the emergence and coexistence of three forms of lending...

Financial inclusion remains to be one of the trending topics and keypriorities considered by developing countries towards building up a resilient financialsector and pursuing economic growth. Accordingly, this paper aims at tackling thepillars of financial inclusion for SMEs introduces a number...

Previous studies researching the impact of fintech on mortgage lending have focused primarily on comparing fintech lenders to traditional bank lenders. We examine how bank lenders have responded to the growth of fintech lending, both as a whole and in terms of small and large banks, for both...

Digital financial services (DFSs) may lower certain costs of accessing finance, but they bring new costs, including difficulties accessing mobile networks. Using the Demographic and Health Surveys and several geocoded databases in Nepal, the Philippines, Senegal and Tanzania, this paper studies...

A common rhetoric has emerged among UK authorities when it comes to how to deal with a potential loss of influence in the regulation of financial services after Brexit: as divergence from the EU increases, it will be necessary to retain the UK’s influence as a rule maker through an enhanced...

The development of the fourth industrial revolution (IR 4.0) in Indonesia has provided progress to various industrial sectors, in line with the development of digital technology which has penetrated almost all sectors, especially the banking sector. With the advancement of this technology, it is...

Based on technical assistance to central banks by the IMF’s Monetary and Capital Markets Department and Information Technology Department, this paper examines fintech and the related area of cybersecurity from the perspective of central bank risk management. The paper draws on findings from...