A look at the implications of technological finance for the future development of the banking sector

Abstract

This article aims to describe the future of traditional banks in the face of the rise of new generations of Fintech, while highlighting the mediating role of digital transformation, regulation, and infrastructure in this relationship, through a review of the state of the art. Fintech, a combination of "finance" and "technology", refers to a wide range of technological innovations that are disrupting and reshaping various aspects of the financial services industry. These innovations cover a broad collection of services, from payment platforms to robo-advisors and blockchain-based solutions. The Fintech revolution has democratized finance by making financial services more accessible and convenient for consumers and businesses. Mobile banking apps, peer-to-peer lending platforms and digital wallets have simplified financial transactions, reducing the need for customers to visit traditional bank branches. As a result, conventional banks are facing increasing competition from fintech organizations offering innovative, user-friendly alternatives. However, implementing such technologies in an economy requires a solid regulatory framework, to ensure the smooth operation of these technological entities, and digital infrastructures are necessary, with the aim of ensuring the smooth running of operations, while maintaining high levels of transparency and security. The main conclusions reveal that banks can adopt different strategies to ensure their sustainability, in a world of perpetual change.

Key words: Fintech, banking industry, digital transformation, financial innovation, smart banking.

JEL Classification: E44

Paper type: Theoretical Research