FinTech and the Financial Stability Board

Ramlall, Indranarain

doi:10.1108/978-1-78756-833-420181016

Cited by 11 publications

(15 citation statements)

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“…Financial technology (FinTech) is an important innovation in the finance industry that brings new paradigm by taking advantage of information technology especially in increasing service quality (Gai, Qiu, & Sun, 2018;Lee & Shin, 2018). Loan innovation offered through FinTech is often called marketplace lending, whereby the potential borrower can look for loans through a peer to peer (P2P) platform on the internet (Stern et al, 2017;Ramlall, 2018).…”

Section: Fintech (P2p Lending) and Banksmentioning

confidence: 99%

“…Fintech-based loans (P2P) have kept on growing and they can serve the small and medium enterprises segment as well as debtors with low income (Ramlall, 2018). However, banking in general is more selective and cautious at providing loans and therefore the loan is more likely to be disbursed to non-MSME debtors (Montgomery, Squires, & Syed, 2018;Zhang, Hu, & Chang, 2019), including in Indonesia.…”

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confidence: 99%

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Indonesian Peer to Peer Lending (P2p) at Entrant’s Disruptive Trajectory

Kohardinata

Soewarno

Tjahjadi

2020

Business: Theory and Practice

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Peer to peer (P2P) lending in Indonesia has been growing rapidly, therefore there is the potential for disruptive innovation processes in the financial sector. The aim of this study is to examine the impact of the growth of P2P lending on the growth of bank lending for micro, small and medium enterprises (MSME) and Non-MSME debtors. Separating the scale of the debtor is important, given the initial process of disruptive innovation of reaching areas that are not the incumbent’s main target. The examination was conducted in this study using panel data regression, whereby the examination was done in stages. This was an overall examination without differentiating between the regions, further examination conducted with more detail by separating between the loans inside and outside Java Island. This is because the economic structure in Indonesia is still dominated by the regions in Java, but FinTech is generally able to grow in areas with less developed local economies. The result of this study is consistent overall, Java and outside Java Island, as shows that the growth in P2P lending in Indonesia does not have a significant impact on the growth of bank loans for Non-MSME lending. However, it does have a negative impact on the growth of bank loans for MSME lending. This is in line with the entrant’s disruptive trajectory process by which the entrants enter the competition through an underserved market (niche markets) and not through the main target market of the incumbent (MSME).

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Section: Fintech (P2p Lending) and Banksmentioning

confidence: 99%

mentioning

confidence: 99%

Indonesian Peer to Peer Lending (P2p) at Entrant’s Disruptive Trajectory

Kohardinata

Soewarno

Tjahjadi

2020

Business: Theory and Practice

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“…The definition of fintech is not uniform in academia. According to the Financial Stability Board, fintech is financial innovation driven by the continuous development and advancement of technology ( Ramlall, 2018 ). In addition, many scholars also conducted research and discussion on the definition of financial technology based on the existing definition and their understanding.…”

Section: Theoretical Frameworkmentioning

confidence: 99%

Fintech, Bank Risk-Taking, and Risk-Warning for Commercial Banks in the Era of Digital Technology

Elahi²,

Zhao

2022

Front. Psychol.

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Fintech risks commercial banks in three ways, particularly operational efficiency, financial innovation, and risk management. Based on the data of 37 Chinese-listed commercial banks from 2011 to 2020, the study empirically analyzes the impact of fintech on bank risk-taking, and the intermediary effects of the three channels, such as operational efficiency, financial innovation, and risk management. The results show that fintech can effectively reduce the risk of banks. The results of heterogeneity analysis revealed that fintech strongly affects the risk-taking of state-owned banks but not obviously for rural commercial banks. Financial efficiency, financial innovation, and risk management indirectly affect the risk-taking of banks that contributed 8.51, 7.18, and 5.77%, respectively. We also constructed the commercial bank risk-warning index. Based on the quarterly data of banks from 2011 to 2020, we empirically tested the early warning effect of the bank risk-warning index. The results showed that when the signal month is set to 12 months, the bank risk-warning index can have a warning effect in this period.

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“…In the past few years, fintech has been increasing significantly, which, to some extent, has led to its growing topic as discussed among the recent academic works. For example, its substantive definition has been addressed as the synonymous of internet finance (Ping and Chuanwei, 2013), internet of thing of financial services (Kim et al, 2016), innovation in commercial startups (Ramlall, 2018) yet is disruptive (Lee and Shin, 2018) and algorithm trading (Jantarakolica and Jantarakolica, 2018). Interestingly, Schueffel (2016) harmonised the intellectual definition of fintech from 200 scientific articles covering more than 40 years.…”

Section: Literature Review 21 Understanding Of Fintechmentioning

confidence: 99%

How does Islamic fintech promote the SDGs? Qualitative evidence from Indonesia

Hudaefi

2020

QRFM

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Purpose This study aims to explore the existing Islamic financial technology (fintech) lending in Indonesia. Doing so is to better understand in what way the fintech firms have been promoting the global movement of sustainable development goals (SDGs) in the local context. Design/methodology/approach This study engages qualitative methods. This paper first reviews relevant literature related to fintech and establishes the substantive definition of Islamic fintech. Further, the existing literature of SDGs is explored to understand its original idea and its recent implementation, particularly in Indonesia. Following this, the official reports from the domestic regulators are referred to select the fintech firms which meet the criteria of Islamic fintech lending based on the proposed definition. The selected firms are then analysed based on several themes which best capture their position in promoting the SDGs. Finally, the discussion is linked to the recent performance of Indonesia in implementing SDGs. Findings This work finds that the reviewed fintech firms have been promoting the idea of financial inclusion, for example, financing the underdeveloped sectors such as agriculture and small and micro enterprises (SMEs). Furthermore, the selected fintech firms are also found to collect and distribute Islamic social funds such as infaq (charity spending), waqf (endowment) and sadaqah (voluntary charity). Besides, the firms are also found to initiate charity programmes for underprivileged community. In some degree, these findings are synonymous of the firms’ effort in promoting SDG of ending poverty (SDG 1) and hunger (SDG 2) and reducing the inequalities (SDG 10). Research limitations/implications The discussion of this work does not provide any positivist generalisation due to the method used. Practical implications The Indonesian Government is advised to legally engage with the existing fintech firms and other related stakeholders to best solve its recent issue of the declining trend in SDG 15 (life on land). Social implications This work elaborates in what way the Islamic fintech lending has been promoting the SDGs in Indonesian context. In some extent, such discussion can best challenge the social issue of fintech which has been stigmatised of bringing mafsadah (harm), as subjectively claimed by one particular religious group in Indonesia. Originality/value This study is among the pioneers which offers the definition of Islamic fintech and further explains its position in endorsing the global movement of SDGs.

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FinTech and the Financial Stability Board

Cited by 11 publications

References 0 publications

Indonesian Peer to Peer Lending (P2p) at Entrant’s Disruptive Trajectory

Indonesian Peer to Peer Lending (P2p) at Entrant’s Disruptive Trajectory

Fintech, Bank Risk-Taking, and Risk-Warning for Commercial Banks in the Era of Digital Technology

How does Islamic fintech promote the SDGs? Qualitative evidence from Indonesia

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