IDEAS home Printed from https://ideas.repec.org/a/spr/snbeco/v4y2024i5d10.1007_s43546-024-00647-0.html
   My bibliography  Save this article

The effect of digital transformation on the cost of China commercial banks

Author

Listed:
  • Fan Yang

    (Universiti Sains Malaysia)

  • Tajul Ariffin Masron

    (Universiti Sains Malaysia)

Abstract

The enthusiasm for digital transformation has not faded. Digital transformation changes worldwide to compete in a tougher environment and foster sustainable development. However, high cost from conventional banks has enabled other financial businesses to steal many clients. Conventional banking must adapt to new models, expectations, and competitors. In order to investigate the issue, this study employs GMM with data collected from 116 Chinese banks between 2014 and 2021. It has been found empirically that bank digital transformation decreases bank expenses considerably and has a positive and significant interaction with bank size. Heterogeneity study reveals that interactions will only occur in the context of high-level digitalization in banks' digital transformation. As a result, the government must give financial assistance to lower the initial investment cost of digital transformation. Banks can lower some of the costs of digital transformation by encouraging cooperation and resource sharing.

Suggested Citation

  • Fan Yang & Tajul Ariffin Masron, 2024. "The effect of digital transformation on the cost of China commercial banks," SN Business & Economics, Springer, vol. 4(5), pages 1-21, May.
    • Handle: RePEc:spr:snbeco:v:4:y:2024:i:5:d:10.1007_s43546-024-00647-0
    DOI: 10.1007/s43546-024-00647-0
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s43546-024-00647-0
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s43546-024-00647-0?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:snbeco:v:4:y:2024:i:5:d:10.1007_s43546-024-00647-0. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.