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Prometheus Unbound: What Makes Fintech Grow?
Author:
Serhan Cevik
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https://orcid.org/0000-0002-2373-2023
Series:
IMF Working Papers
Volume/Issue:
Volume 2025: Issue 044
Language:
English
Publication Date:
21 Feb 2025
DOI:
https://doi.org/10.5089/9798229001892.001
ISBN:
9798229001892
ISSN:
1018-5941
Pages:
17
Keywords:
Fintech; financial innovation; technological change; cybersecurity threat; fintech venture; copyright page; government stability foster fintech growth; fintech transaction; Digital financial services; Financial sector development; Population growth; Europe
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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The rise of financial technologies—fintech—could have transformative effects on the financial landscape, expanding the reach of services beyond the confines of geography and creating new competitive sources of finance for households and firms. But what makes fintech grow? Why do some countries have more financial innovation than others? In this paper, I use a comprehensive dataset to investigate the emergence and spread of fintech in a diverse panel of 98 countries over the period 2012–2020. This empirical analysis helps ascertain economic, demographic, technological and institutional factors that enable the development of fintech. The magnitude and statistical significance of these factors vary according to the type of fintech instrument and the level of economic development (advanced economies vs. developing countries). Finally, these findings reveal that policies and structural reforms can help promote financial innovation and cultivate fintech ventures—particularly by strengthening technological and institutional infrastructures and reducing cybersecurity threats.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund