IDEAS home Printed from https://ideas.repec.org/a/gam/jjrfmx/v16y2023i9p413-d1241954.html
   My bibliography  Save this article

Does Financial Technology Adoption Influence Bank’s Financial Performance: The Case of Jordan

Author

Listed:
  • Thair A. Kaddumi

    (Faculty of Business, Applied Science Private University, Amman 541350, Jordan
    MEU Research Unit, Middle East University, Amman 541350, Jordan)

  • Hafez Baker

    (Financial Services Company, Trading Company, Abu Dhabi 59559, United Arab Emirates)

  • Mahmoud Daoud Nassar

    (College of Business, Al Ain University, Abu Dhabi 112612, United Arab Emirates)

  • Qais A-Kilani

    (Faculty of Business, Applied Science Private University, Amman 541350, Jordan)

Abstract

This research will examine the impact of the adoption of financial technology on conventional banks’ financial performances. The research will place emphasis on the listed commercial banks at Amman Stock Exchange—ASE, using financial data for the period 2012–2020. The main study tool was a questionnaire that focuses on three main dimensions: financial inclusion—(FI), alternative payment methods—(APMs) and automation—(Auto). A total of 115 questionnaires were distributed to all commercial banks listed at Amman Stock Exchange—ASE. Multivariate regression analysis was employed to test the impact of the FinTech dimension as a proxy for independent variables on Jordanian commercial bank’s financial performance as a proxy for dependent variables. Based on the analysis results, the study concludes that all three FinTech dimensions: FI, APMs and Auto. reflected a positive significant impact on Jordanian commercial bank’s financial performance indicators (total deposit, total loans and net profit margin). Therefore, banks in general should invest more and more into financial technology tools and applications, in order to recruit potential clients and retain their current clients, to be able to sustain under fierce competition within the banking sector.

Suggested Citation

  • Thair A. Kaddumi & Hafez Baker & Mahmoud Daoud Nassar & Qais A-Kilani, 2023. "Does Financial Technology Adoption Influence Bank’s Financial Performance: The Case of Jordan," JRFM, MDPI, vol. 16(9), pages 1-17, September.
    • Handle: RePEc:gam:jjrfmx:v:16:y:2023:i:9:p:413-:d:1241954
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/1911-8074/16/9/413/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/1911-8074/16/9/413/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Li, Jianping & Li, Jingyu & Zhu, Xiaoqian & Yao, Yinhong & Casu, Barbara, 2020. "Risk spillovers between FinTech and traditional financial institutions: Evidence from the U.S," International Review of Financial Analysis, Elsevier, vol. 71(C).
    2. Mark A Chen & Qinxi Wu & Baozhong Yang, 2019. "How Valuable Is FinTech Innovation?," The Review of Financial Studies, Society for Financial Studies, vol. 32(5), pages 2062-2106.
    3. Pradeep Dwivedi & Jawaher Ibrahim Alabdooli & Rajeev Dwivedi, 2021. "Role of FinTech Adoption for Competitiveness and Performance of the Bank: A Study of Banking Industry in UAE," International Journal of Global Business and Competitiveness, Springer, vol. 16(2), pages 130-138, December.
    4. Anagnoste Sorin, 2017. "Robotic Automation Process - The next major revolution in terms of back office operations improvement," Proceedings of the International Conference on Business Excellence, Sciendo, vol. 11(1), pages 676-686, July.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Wang, Xiaoting & Hou, Siyuan & Kyaw, Khine & Xue, Xupeng & Liu, Xueqin, 2023. "Exploring the determinants of Fintech Credit: A comprehensive analysis," Economic Modelling, Elsevier, vol. 126(C).
    2. Chi-Ming Ho, 2023. "Research on interaction of innovation spillovers in the AI, Fin-Tech, and IoT industries: considering structural changes accelerated by COVID-19," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 9(1), pages 1-29, December.
    3. Chen, Yuxuan & Chiu, Junmao & Chung, Huimin, 2022. "Givers or Receivers? Return and volatility spillovers between Fintech and the Traditional Financial Industry," Finance Research Letters, Elsevier, vol. 46(PB).
    4. Ebrahim Mohammed Al-Matari & Mahfoudh Hussein Mgammal & Mushari Hamdan Alosaimi & Talal Fawzi Alruwaili & Sultan Al-Bogami, 2022. "Fintech, Board of Directors and Corporate Performance in Saudi Arabia Financial Sector: Empirical Study," Sustainability, MDPI, vol. 14(17), pages 1-23, August.
    5. Liu, Jiangtao & Zhang, Yi & Kuang, Jia, 2023. "Fintech development and green innovation: Evidence from China," Energy Policy, Elsevier, vol. 183(C).
    6. Itay Goldstein & Wei Jiang & G Andrew Karolyi, 2019. "To FinTech and Beyond," The Review of Financial Studies, Society for Financial Studies, vol. 32(5), pages 1647-1661.
    7. Ana Abras & Guilherme G. C. Mattos, 2021. "Get Them While They Are Young," Journal of Financial Services Research, Springer;Western Finance Association, vol. 59(1), pages 97-113, April.
    8. Wang, Yi-Ran & Ma, Chao-Qun & Ren, Yi-Shuai, 2022. "A model for CBDC audits based on blockchain technology: Learning from the DCEP," Research in International Business and Finance, Elsevier, vol. 63(C).
    9. Georgy B. Kleiner & Maksim A. Rybachuk & Venera A. Karpinskaya, 2020. "Development of ecosystems in the financial sector of Russia," Upravlenets, Ural State University of Economics, vol. 11(4), pages 2-15, September.
    10. Hasan, Iftekhar & Li, Xiang & Takalo, Tuomas, 2023. "Technological innovation and the bank lending channel of monetary policy transmission," BOFIT Discussion Papers 9/2023, Bank of Finland Institute for Emerging Economies (BOFIT).
    11. Jiamin Liu & Xiaoyu Ma & Bin Zhao & Qi Cui & Sisi Zhang & Jiaoning Zhang, 2023. "Mandatory Environmental Regulation, Enterprise Labor Demand and Green Innovation Transformation: A Quasi-Experiment from China’s New Environmental Protection Law," Sustainability, MDPI, vol. 15(14), pages 1-31, July.
    12. Marc Gilbert Joseph Buchholzer, 2022. "Review of International Comparative Management Volume 23, Issue 1, March 2022 101 Value-ADDED Automation, a Solution for the Future of Work in Automotive Manufacturing in Romania," REVISTA DE MANAGEMENT COMPARAT INTERNATIONAL/REVIEW OF INTERNATIONAL COMPARATIVE MANAGEMENT, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 23(1), pages 101-111, March.
    13. Cahill, Daniel & G. Baur, Dirk & (Frank) Liu, Zhangxin & W. Yang, Joey, 2020. "I am a blockchain too: How does the market respond to companies’ interest in blockchain?," Journal of Banking & Finance, Elsevier, vol. 113(C).
    14. Aurel Burciu & Rozalia Kicsi & Simona Buta & Mihaela State & Iulia Burlac & Denisa Alexandra Chifan & Beatrice Ipsalat, 2023. "The Study of the Relationship among GCI, GII, Disruptive Technology, and Social Innovations in MNCs: How Do We Evaluate Financial Innovations Made by Firms? A Preliminary Inquiry," FinTech, MDPI, vol. 2(3), pages 1-42, August.
    15. Yinhong Yao & Jianping Li, 2022. "Operational risk assessment of third-party payment platforms: a case study of China," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 8(1), pages 1-20, December.
    16. Huiping Zhu & Haifeng Gu & Habiba Halepoto, 2022. "Can Fulfillment of Social Responsibility Enable Enterprises to Innovate? The Role of Corporate Financialization and Agency Costs," Sustainability, MDPI, vol. 14(21), pages 1-22, October.
    17. Chen, Xiaohui & Teng, Lei & Chen, Wen, 2022. "How does FinTech affect the development of the digital economy? Evidence from China," The North American Journal of Economics and Finance, Elsevier, vol. 61(C).
    18. Emmanuel Joel Aikins Abakah & Aviral Kumar Tiwari & Chi‐Chuan Lee & Matthew Ntow‐Gyamfi, 2023. "Quantile price convergence and spillover effects among Bitcoin, Fintech, and artificial intelligence stocks," International Review of Finance, International Review of Finance Ltd., vol. 23(1), pages 187-205, March.
    19. Krakau, Jan & Feldmann, Carsten & Kaupe, Victor, 2021. "Robotic process automation in logistics: Implementation model and factors of success," Chapters from the Proceedings of the Hamburg International Conference of Logistics (HICL), in: Jahn, Carlos & Kersten, Wolfgang & Ringle, Christian M. (ed.), Adapting to the Future: Maritime and City Logistics in the Context of Digitalization and Sustainability. Proceedings of the Hamburg International Conf, volume 32, pages 219-256, Hamburg University of Technology (TUHH), Institute of Business Logistics and General Management.
    20. Kraemer-Eis, Helmut & Botsari, Antonia & Gvetadze, Salome & Lang, Frank & Torfs, Wouter, 2019. "European Small Business Finance Outlook: December 2019," EIF Working Paper Series 2019/61, European Investment Fund (EIF).

    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:gam:jjrfmx:v:16:y:2023:i:9:p:413-:d:1241954. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.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.