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Banks’ Physical Footprint and Financial Technology Adoption

Author

Listed:
  • Lucas A. Mariani

    (Università degli Studi di Milano Bicocca)

  • José Renato H. Ornelas

    (Banco Central do Brasil Università)

  • Bernardo Ricca

    (Insper)

Abstract

Do physical bank branches moderate the diffusion of digital payment technologies? Does the diffusion of an efficient and inclusive digital payment technology allow fintechs to increase their presence? To answer these questions, we leverage bank heists that use explosives and render branches temporarily inoperable. We provide evidence that these attacks are not associated with local crime trends and that they deplete the branches’ cash inventory. Moreover, we show that they lead to persistent increases in digital payments usage and that a smaller cash dependence boosts digital institutions’ growth not only in payments but also in credit markets.

Suggested Citation

  • Lucas A. Mariani & José Renato H. Ornelas & Bernardo Ricca, 2024. "Banks’ Physical Footprint and Financial Technology Adoption," ERSA Working Paper Series 26, Economic Research Southern Africa.
    • Handle: RePEc:rza:ersawp:26
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    File URL: https://ersawps.org/index.php/working-paper-series/article/view/26/7
    File Function: First version, 2024
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    Keywords

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    JEL classification:

    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Systems; Standards; Regimes; Government and the Monetary System
    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • G20 - Financial Economics - - Financial Institutions and Services - - - General
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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