Research on the Impact of Fintech on the Profitability of Commercial Banks

Abstract

The external competition brought about by the rapid rise of financial technology companies has prompted the banking industry to develop fintech businesses, and the development of fintech businesses will have a certain impact on bank performance. Based on the financial data of 20 listed commercial banks in China from 2014 to 2023, this paper researches the impact of fintech development on bank performance. Preliminary analysis through panel regression shows that the development of fintech business has reduced the operating performance of the banking industry. By constructing period dummy variables, this paper analyzes the changes in the impact of fintech development on bank performance in different periods. Fintech is an emerging thing and has its imperfect side. The banking industry should accelerate the pace of financial innovation, build its own fintech business, and cooperate with fintech enterprises to achieve mutual benefit and win-win results, so as to enhance the overall competitiveness of China’s banking industry with the development of fintech.