Transforming Financial Services: The Impact of FinTech Innovation on the Customer Adoption

Authors

  • Muhammad Murad School of Business Management, Universiti Utara Malaysia (UUM)
  • Brig Sohail Ahmad Iqra University, Islamabad

DOI:

https://doi.org/10.52461/jftis.v2i1.2070

Keywords:

FinTech Innovation, Banking Sector Transformation, Customer Adoption

Abstract

This study aimed to determine the correlations between FinTech innovation, banking sector transformation, and customer adoption of FinTech-based services in Pakistan's banking sector. Data was collected from Pakistani bank employees using a quantitative research methodology. A survey questionnaire was used to gather responses on innovation in fintech, banking sector transformation, and customer uptake of fintech-based services. The results showed a strong positive correlation between FinTech innovation and customer uptake in the banking industry, which was mediated by banking sector transformation. This highlights the importance of banks altering their business models and services to effectively utilise FinTech solutions. By adopting FinTech innovations and supporting banking sector change, financial institutions can increase consumer uptake, position themselves for sustainable growth, and remain competitive in the rapidly changing financial services industry. This study provides valuable insights for banking executives and decision-makers seeking to enhance customer service and support the growth of the banking industry in innovation and resilience.

References

Ain, Q., & Shafique, O. (2022). Development and validation of a questionnaire to identify the barriers to adopting green transformation. Competitive Educational Research Journal. 3(2), 77-103

Alaassar, A., Mention, A.-L., & Aas, T. H. (2023). Facilitating innovation in FinTech: a review and research agenda. Review of Managerial Science, 17(1), 33-66. https://doi.org/10.1007/s11846-022-00531-x

Alam, N., Gupta, L., & Zameni, A. (2019). Fintech and Islamic finance (1 ed.). Springer. https://doi.org/10.1007/978-3-030-24666-2

Budnitz, M. E. (1997). Privacy protection for consumer transactions in electronic commerce: why self-regulation is inadequate. SCL Rev., 49, 847.

Butt, S., & Khan, Z. A. (2019). Fintech in Pakistan: a qualitative study of bank’s strategic planning for an investment in fin-tech company and its challenges. Independent Journal of Management & Production, 10(6), 2092-2101. https://doi.org/10.14807/ijmp.v10i6.947

Fasnacht, D., & Fasnacht, D. (2018). Open innovation in the financial services. In. Springer. https://doi.org/10.1007/978-3-319-76394-1_4

Filotto, U., Caratelli, M., & Fornezza, F. (2021). Shaping the digital transformation of the retail banking industry. Empirical evidence from Italy. European Management Journal, 39(3), 366-375. https://doi.org/10.1016/j.emj.2020.08.004

Goel, P., Kulsrestha, S., & Maurya, S. K. (2022). Fintech Unfolding: Financial Revolution in India. Thailand and The World Economy, 40(2), 41-51.

Gomber, P., Kauffman, R. J., Parker, C., & Weber, B. W. (2018). On the fintech revolution: Interpreting the forces of innovation, disruption, and transformation in financial services. Journal of management information systems, 35(1), 220-265. https://doi.org/10.1080/07421222.2018.1440766

Goswami, S., Sharma, R. B., & Chouhan, V. (2022). Impact of financial technology (Fintech) on financial inclusion (FI) in Rural India. Universal Journal of Accounting and Finance, 10(2), 483-497. https://doi.org/10.13189/ujaf.2022.100213

Hasan, M. M., Yajuan, L., & Khan, S. (2022). Promoting China’s inclusive finance through digital financial services. Global Business Review, 23(4), 984-1006. https://doi.org/10.1177/0972150919895348

Jamal, W. N., Shafique, O., Sarwar, S., & Khan, M. (2020). Factors Affecting Bankers’ Behavioural Intentions to Adopt Green Banking in Pakistan: An Empirical Study. International Journal of Management Research and Emerging Sciences, 10(3), 99-108.

Jariyapan, P., Mattayaphutron, S., Gillani, S. N., & Shafique, O. (2022). Factors Influencing the Behavioural Intention to Use Cryptocurrency in Emerging Economies During the COVID-19 Pandemic: Based on Technology Acceptance Model 3, Perceived Risk, and Financial Literacy. Frontiers in Psychology. 12:814087.

Kamphuis, M. J. (2021). Platforms in healthcare: A qualitative multiple case study to explore how to achieve successful platforms for information, integration and innovation University of Twente). http://essay.utwente.nl/86425/

Kumari, A., & Devi, N. C. (2022). The Impact of FinTech and Blockchain Technologies on Banking and Financial Services. Technology Innovation Management Review, 12(1/2), 22010204. http://doi.org/10.22215/timreview/1481

Mainardes, E. W., & Freitas, N. P. d. (2023). The effects of perceived value dimensions on customer satisfaction and loyalty: a comparison between traditional banks and fintechs. International Journal of Bank Marketing, 41(3), 641-662.

Nangin, M. A., Barus, I. R. G., & Wahyoedi, S. (2020). The effects of perceived ease of use, security, and promotion on trust and its implications on fintech adoption. Journal of Consumer Sciences, 5(2), 124-138. https://doi.org/10.29244/jcs.5.2.124-138

Pramanik, H. S., Kirtania, M., & Pani, A. K. (2019). Essence of digital transformation—Manifestations at large financial institutions from North America. Future Generation Computer Systems, 95, 323-343. https://doi.org/10.1016/j.future.2018.12.003

Puschmann, T., Hoffmann, C. H., & Khmarskyi, V. (2020). How green FinTech can alleviate the impact of climate change—the case of Switzerland. Sustainability, 12(24), 10691. https://doi.org/10.3390/su122410691

Rizvi, S. K. A., Naqvi, B., & Tanveer, F. (2018). Is Pakistan ready to embrace Fintech innovation? The Lahore Journal of Economics, 23(2), 151-182.

Rot, A., & Blaicke, B. (2019). Blockchain’s future role in cybersecurity. analysis of defensive and offensive potential leveraging blockchain-based platforms. 2019 9th International Conference on Advanced Computer Information Technologies (ACIT) (pp. 447-451). IEEE. https://doi.org/10.1109/ACITT.2019.8779855

Salameh, A. A., Aman-Ullah, A., Mehmood, W, & Abdul-Majid, A. B. (2023). Does employer branding facilitate the retention of healthcare employees? A mediation moderation study through organisational identification, psychological involvement, and employee loyalty. International Journal of Hospitality Management, 112, 103414

Shafique, O., & Khan, M. (2020). Factors Affecting Bankers’ Behavioural Intention to Adopt Green Banking: An Empirical Analysis of Banks in Pakistan. Journal of Business and Social Review in Emerging Economies, 6(2), 835-843.

Shafique, O., Khizar, H. M. U., Jamal, W. N., Sarwar, S., & Khan, M. (2020). An Empirical Study on the Factors Affecting Bankers’ Behavioural Intention to Adopt Green Banking in Pakistan. PalArch’s Journal of Archaeology of Egypt / Egyptology, 17(11), 1-11.

Shafique, O., & Majeed, A. (2020). Factors influencing bankers’ intention to adopt green finance in Pakistan. Review of Economics and Development Studies, 6(4), 773-785. https://doi.org/10.47067/reads.v6i4.277

Singh, S., Sahni, M. M., & Kovid, R. K. (2020). What drives FinTech adoption? A multi-method evaluation using an adapted technology acceptance model. Management Decision, 58(8), 1675-1697. https://doi.org/10.1108/MD-09-2019-1318

Tapanainen, T. (2020). Toward fintech adoption framework for developing Countries-A literature review based on the stakeholder perspective. Journal of Information Technology Applications & Management, 27(5), 1-22.

Temelkov, Z. (2020). Differences between traditional bank model and fintech based digital bank and neobanks models. SocioBrains, International scientific refereed online journal with impact factor, (74), 8-15.

Tripathi, D., & Khan, I. (2023). Employees Performance Measurement and Increasing in Digital Era: A Study From the Perspective of Developing Economies. Business Review of Digital Revolution, 3(1), 30-37. https://brdr.org/index.php/researchrise/article/view/24

Warda, N. J., Shafique, O., Sarwar, S., & Khan, M. (2020). Factors Affecting Bankers’ Behavioural Intentions to Adopt Green Banking in Pakistan: An Empirical Study. International Journal of Management Research and Emerging Science, 10(3), 99-108. https://doi.org/10.56536/ijmres.v10i3.109

Yanagawa, E. (2023). The invoice data exchange accelerates SME banking innovation: Trends and initiatives for e-invoicing in Japan. Journal of Digital Banking, 7(3), 233-248.

Yi, T. Z., Rom, N. A. M., Hassan, N. M., Samsurijan, M. S., & Ebekozien, A. (2023). The Adoption of Robo-Advisory among Millennials in the 21st Century: Trust, Usability and Knowledge Perception. Sustainability, 15(7), 6016. https://doi.org/10.3390/su15076016

Downloads

Published

2023-06-30

How to Cite

Murad , M., & Ahmad , B. S. (2023). Transforming Financial Services: The Impact of FinTech Innovation on the Customer Adoption. Journal of Financial Technologies (Fintech), Inclusion and Sustainability, 2(1), 87–98. https://doi.org/10.52461/jftis.v2i1.2070

Issue

Vol. 2 No. 1 (2023): Vol. 2 No. 1 (2023): Journal of Financial Technologies (Fintech), Inclusion and Sustainability (JFTIS)

Section

Articles

License

Copyright (c) 2023 Muhammad Murad , Brig Sohail Ahmad

Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.

The authors submitting and publishing in JFTIS agree to the copyright policy under Creative Commons CC-BY-NC 4.0 International license (Attribution-Non Commercial 4.0 International). Under this license, the authors published in JFTIS retain the copyright including publishing rights of their scholarly work and agree to let others remix, tweak, and build upon their work non-commercially.