Impact of Fintech and Operational Efficiency on Financial Performance with Fixed Assets as a Moderating Variable in Banks

Background: Operational efficiency has become a critical determinant of financial performance in the digital era. Financial institutions that invest in advanced technological infrastructure—such as high-capacity servers and dependable communication networks—are better equipped to deliver continuous and reliable digital services. This capability enhances customer acquisition and retention, while simultaneously increasing transaction volumes. Aims: This study aims to analyse the impact of Financial Technology (Fintech), Operational Efficiency, and Fixed Assets on the financial performance of banks in Indonesia. Additionally, the study explores the moderating role of Fixed Assets in enhancing the impact of Financial Technology and Operational Efficiency on financial performance. Study Design: This is a quantitative research study using secondary data from banks listed on the Indonesia Stock Exchange (IDX) from 2021 to 2023. Place and Duration of Study: Data were collected from commercial banks listed on the Indonesia Stock Exchange, spanning the years 2021 to 2023. Methodology: The study utilised panel data regression analysis to examine the relationship between Financial Technology, Operational Efficiency, Fixed Assets, and financial performance. The data was sourced from the annual reports and quarterly financial publications of banks, focusing on variables like mobile banking usage, operational efficiency, and fixed asset investments. The moderating effect of Fixed Assets was analysed using interaction terms in the regression model. Results: The results revealed that Financial Technology significantly influences financial performance. However, Operational Efficiency showed no significant direct impact, though it became significant when moderated by Fixed Assets. Fixed Assets were found to significantly moderate the relationship between Financial Technology and Operational Efficiency in improving financial performance. Conclusion: The study concludes that while Financial Technology and Operational Efficiency are essential for improving financial performance, their effects are significantly strengthened when supported by adequate investments in Fixed Assets. Banks should focus on enhancing their technological infrastructure and operational efficiency to maximise their financial performance.