Fintech and the performance of Iranian banking network (Autoregressive distributed lag)

Document Type : Original

Authors

Department of Banking, Monetary and Banking Research Institute, Central Bank of Iran, Tehran, Iran.

Abstract

Today, the importance of the presence and emergence of fintech, especially fintech active in the financial field, is not hidden from anyone. The importance of this matter is to the extent that a wide range of recent studies has been conducted on the performance of fintech and their relationship with the banking sector at the international level. In Iran, there are more than 50 fintech companies that have entered into various sectors of the banks' business model. Therefore, their presence can affect the performance of Iranian banks. In this article, using the ARDL model and time series data during 1991-2021, the effect of fintech in the short and long term on the performance of Iranian banks has been investigated. In this article, fintechs are divided into two groups: competing fintech and non-competing fintech. Fintech lifetime has been used as a measure of fintech presence. The return on assets has been used as banks' performance. The results of the accuracy of the model indicate the normality of the distribution of residual, the absence of serial correlation, the existence of homogeneity variance and the existence of the long-term relationship. The results of the survey show a significant relationship between fintech and the banks' profitability. So, in the long run, both competing and non-competing fintech have a negative effect on banks' profitability. But, in the short term, non-competing fintech has a positive relationship, and competing fintech, except for crowdfunding and land techs, has a negative relationship with banks' profitability.

Keywords

Main Subjects

حوزة موضوعی: ایران

Scope: Iran

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Journal of Countries Studies
Volume 1, Issue 2
2023
Pages 313-351

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History

  • Receive Date: 15 April 2023
  • Revise Date: 01 May 2023
  • Accept Date: 20 May 2023

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