CHALLENGES AND TRENDS OF FINTECH DEVELOPMENT IN THE BANKING, INSURANCE AND FUND MARKETS

Authors

  • Bohdan Lutsiv dr.sc.(econ.), professor, professor at the department of financial technologies and banking business, West Ukrainian National University, Ternopil
  • Yaroslav Chaikovskyi cand.sc.(econ.), assoc. prof., associate professor at the department of financial technologies and banking business, West Ukrainian National University, Ternopil

Keywords:

digitalization, FinTech, artificial intelligence, blockchain technology, cyber security.

Abstract

Lutsiv B.L., Chaikovskyi Ya.I. CHALLENGES AND TRENDS OF FINTECH DEVELOPMENT IN THE BANKING, INSURANCE AND FUND MARKETS

Purpose. The aim of the article is to study of the role of FinTech in the processes of digital transformation of banking with the identification of challenges and trends for the banking system of Ukraine.

Methodology of research. The following research methods were used to achieve the goal: analysis and synthesis, abstract and logical – to characterize the stages of digital transformation in banking, substantiation of digital technologies that will contribute to the reform of the banking sector; monographic and comparative – for the study of the legislative field in the introduction of financial technologies in the banking sector of Ukraine.

Findings. It has been established that the development of financial technologies (FinTech) significantly affects the banking business, causing both positive changes and new challenges, which significantly transforms the banking business. The essential characteristics of digital technologies that are reforming the banking sector are revealed, as well as an assessment of the advantages and risks brought by digitalization to the banking sector, which made it possible to determine its trends and challenges, namely: the introduction of digital service channels, the use of modern technologies and integration with state digital platforms. It has been proven that the successful digitalization of the banking sector of Ukraine depends on the ability of financial institutions to adapt to new technologies, while ensuring a high level of security and compliance with regulatory requirements.

Originality. The rationale for integrating innovative technologies, improving legislation and increasing financial literacy to achieve synergy between the financial and banking sector and FinTech has received further development, which will contribute to economic growth, increasing financial inclusion and competitiveness of Ukraine on the global market.

Practical value. The results of the conducted research will enable the banking sector of Ukraine to respond adequately to the challenges posed by the digitalization of the banking business, and to realistically assess the risks associated with these challenges in order to achieve the effectiveness of the introduction of financial technologies into the practical activities of working with bank clients.

Key words: digitalization, FinTech, artificial intelligence, blockchain technology, cyber security.

References

“Development of fintech in Ukraine”, available at: https://bank.gov.ua/ua/about/develop-strategy/fintech2025 (access date August 04, 2024).

National Bank of Ukraine (2020), “Fintech development strategy in Ukraine until 2025. Sustainable development of innovations, cashless and financial literacy”, 49 p., available at: https://bank.gov.ua/ua/files/DDWIAwXTdqjdClp (access date August 04, 2024).

Pshyk, B.I. and Hrudzevych, U.Ya. (2023), “Improvement of FINTEX regulation on the market of banking services in Ukraine”, Ekonomika ta suspilstvo, Issue 54, DOI: https://doi.org/10.32782/2524-0072/2023-54-67.

Viazovyi, S. (2023), “FinTech in Ukraine: the path to an innovative future of cashless payments”, Ekonomika ta suspilstvo, Issue 54, https://doi.org/10.32782/2524-0072/2023-54-36.

Diakonova, I.I., Pavlenko, L.D. and Kryklii, O.A. (2019), “The current state and prospects of collaboration between banks and FinTech”, Problemy i perspektyvy ekonomiky ta upravlinnia, no. 1(17), pp. 190-199, available at: https://www.researchgate.net/publication/339334519_SUCASNIJ_STAN_TA_PERSPEKTIVI_KOLABORACII_BANKIV_TA_FINTECH (access date August 04, 2024).

Agarwal, R. and Sebn, W. (2019), “Didital Transformation in Banking: A Conceptual Model”, International Journal of Bank Marketing, no. 37(3), pp. 828-844.

Mc Kinsey 8 Company (2021), “Didital Banking: Building a Customer – Centric Business Model”, available at: https://www.mckinsey.com/industries/financial–services/our–insights/didital–banking–building–a–customer–centric–busintss–model (access date August 04, 2024).

“Digital transformation in banking”, available at: https://blog.yocontrol.market/tsifrofa–transformatsia–u–bankinghu (access date August 02, 2024).

Kravchuk, N. and Lutsyshyn, O. (2022), “Global finance and FinTech: challenges, trends and systemic determinants of development”, Svit finansiv, Issue 2(71), pp. 22-42. DOI: 10.35774/sf2022.02.022.

“Ukrainian catalog of fintech companies 2024”, 102 p., available at: https://drive.google.com/file/d/1YCkzK8FRm7gBTsFXbyJvoeQCCZ8d_d0_/view (access date August 04, 2024).

Lutsiv, B.L. (2018), “Fin Tech in the system of financial inclusion”, Svit finansiv, no. 4, pp. 110-120, available at: http://sf.wunu.edu.ua/index.php/sf/article/view/1074/1079 (access date August 04, 2024).

Chaikovskyi, Ya.I. and Kovalchuk, Ya.Yu. (2020), “Modern fintech directions in the banking sector”, Svit finansiv, no. 2(63), pp. 36-48, DOI: 10.35774/sf2020.02.036.

Downloads

Issue

No. 3 (2024): INNOVATIVE ECONOMY

Section

Statistics, accounting, analysis and audit

License

Open-access articles (open-access journals)

Authors whose articles are published in open-access retain all rights to the content of the articles.

Open access articles are committed to be published under Creative Commons Attribution (CC BY) 4.0. This license allows others to distribute, edit, correct and build upon your work, even commercially, as long as they indicate your authorship. Detailed information at Creative Commons site: https://creativecommons.org/licenses/by/4.0/

Permissions for open-access journals

If the article is published in open-access under CC BY 4.0 or CC BY-NC 4.0 (which was possible till the 15th of December, 2018) licenses, users may reproduce it in accordance with their terms.

Additionally, if the article had been published under CC BY-NC 4.0 (this license authorizes others to download your works and share them with others as long as they indicate your authorship, but they can’t use them commercially in any case.), the use for the following commercial purposes requires permission:

– reproduction of content in a work or product intended for sale;

– reproduction in presentations, brochures or other marketing materials used for commercial purposes;

– distribution of the content to promote or market a person, product, course, service or organization;

– text and data mining for the purpose of creating a saleable product or product which benefits from promotional or advertising revenue;

– use of the content by a commercial entity or individual for the purposes of remuneration, directly or indirectly through sale, licensing, promotion or advertising;

– linking to the content (in an email, webpage, portable electronic device or otherwise) for the specific purpose of marketing or advertising a person, product, course, service or organization for commercial benefit.

For further details and permission requests, please contact.

How to Cite

“CHALLENGES AND TRENDS OF FINTECH DEVELOPMENT IN THE BANKING, INSURANCE AND FUND MARKETS”. INNOVATIVE ECONOMY, no. 3, Jan. 2025, pp. 193-9, https://inneco.org/index.php/innecoen/article/view/1349.