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Can the development of Fintech mitigate non-performing loan risk?

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  • Chai, Yuanzhe
  • Sun, Suchao

Abstract

This paper examines how commercial banks’ fintech development can mitigate non-performing loan (NPL) risk. This study adopted a two-fixed model and examined listed commercial banks from 2011 to 2022. Findings indicate that fintech development can mitigate NPL risk through pre-lending and post-loan cost reduction and revenue growth effects. This study contributes to theory and practice for advancing the growth of commercial banks while upholding the stability of the financial system. The findings provide a reference for nations using digital technology to maintain financial stability.

Suggested Citation

  • Chai, Yuanzhe & Sun, Suchao, 2024. "Can the development of Fintech mitigate non-performing loan risk?," Finance Research Letters, Elsevier, vol. 67(PB).
    • Handle: RePEc:eee:finlet:v:67:y:2024:i:pb:s154461232400919x
    DOI: 10.1016/j.frl.2024.105889
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    References listed on IDEAS

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    1. Wang, Xi & Tang, Yanfei, 2024. "Does non-bank fintech development hurt the effect of targeted monetary policy tools? Micro evidence from China," Finance Research Letters, Elsevier, vol. 62(PA).
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    6. Feng, Yongqi & Cao, Yue & Ni, Juan, 2024. "Does Fintech affect shadow banking of non-financial firms? Evidence from the entrusted loans," International Review of Financial Analysis, Elsevier, vol. 94(C).
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