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Nexus Between Fintech Innovations and Liquidity Risk in GCC Banks: The Moderating Role of Bank Size

Author

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  • Laith Alshouha

    (Aviation School, Aviation Management Department, Royal Jordanian Air Force Technical University College for Aviation Sciences, Almafraq 11190, Jordan)

  • Ohoud Khasawneh

    (Business School, Finance Department, Amman Arab University, Amman 11953, Jordan)

  • Fadi Alshannag

    (Business School, Finance Department, Jadara University, Irbed 21110, Jordan)

  • Khalid Al Tanbour

    (Business School, Economic Department, University of Jordan, Amman 11942, Jordan)

Abstract

Fintech is a modern phenomenon that is transforming the banking industry through innovations that streamline financial processes and improve efficiency. The increasing adoption of disruptive technologies prompts inquiries regarding their potential to either bolster banks’ stability or expose them to various challenges and risks, including liquidity issues. Hence, this paper analyzes the effect of fintech innovations on liquidity risks in commercial banks across the six GCC countries (comprising a major financial market) during the period from 2018 to 2023. To develop a panel data methodology, we chose a sample of 26 commercial banks. The findings from our analysis indicated that (1) fintech innovations have a negative relationship with liquidity risks and (2) the size of the bank moderates the connection between fintech and liquidity risks (whereby larger banks significantly affect the relationship between fintech innovations and liquidity risks).

Suggested Citation

  • Laith Alshouha & Ohoud Khasawneh & Fadi Alshannag & Khalid Al Tanbour, 2025. "Nexus Between Fintech Innovations and Liquidity Risk in GCC Banks: The Moderating Role of Bank Size," JRFM, MDPI, vol. 18(5), pages 1-21, April.
    • Handle: RePEc:gam:jjrfmx:v:18:y:2025:i:5:p:226-:d:1641135
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    References listed on IDEAS

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