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The study examines how process/organizational innovation and R&D spending mediate the relationship between financial performance and the resource dependence theory in Fintech, providing insights into effective innovation strategies for achieving sustainable financial performance.

Data from 191 financial firms in Taiwan was collected from annual reports using the Taiwan Economic Journal (TEJ), a financial information provider. Content analysis was used to measure innovation activities and financial performance, with process and organizational innovation defined. R&D expenditures were also collected and used in statistical analysis to explore the relationship between variables.

This study on the financial services industry shows that process innovation and R&D expenditure positively impact firm performance, while organizational innovation may have a negative short-term effect but could have long-term benefits.

Limitations of this study include vulnerability to spurious effects and the use of data from only listed financial service firms. Future research should use more short-term performance data and include unlisted firms in the financial services industry to extend the study’s coverage.

This study extends resource dependence theory to financial services and explores the effects of process and organizational innovation on firm performance. Results show that internal process management boosts performance, while external collaboration with startups enhances Fintech innovation and efficiency, with positive short-term effects. The study highlights the importance of interacting with external organizations to access resources and improve performance in financial services.

For over a decade, fintech has challenged traditional business models and processes in the financial services industry. The ongoing disruption has necessitated the digital transformation of financial institutions (FIs) to remain an integral part of the financial system. This paradigm shift is not merely a technological update. Still, it signifies a cultural and operational rebirth, compelling FIs to embrace innovation, adaptability, and a customer-centric approach in the digital era. Independent of the business model, FIs must become digitally ambidextrous, offer tailored and dynamic customer experiences, support financial inclusion, and promote an environmental, social, and governance (ESG) agenda while leveraging data and remaining compliant. From digitalization to fintegration, the financial services industry's future is deemed to be an exciting and productive one.

This chapter explores the vast array of fintech opportunities. The industry commanded approximately $250 billion in revenue in 2022, which is predicted to grow to $1.5 trillion by 2030. Fintech firms are involved in everything from digital currencies to payment systems, lending platforms, and embedded finance. Firms use artificial intelligence (AI) and machine learning (ML) to create personalized financial products. One of the most important benefits to society is that fintech makes finance more inclusive to the traditionally underserved. However, fintech has its challenges. Regulations evolve, making compliance a challenge. Also, the industry is vulnerable to cyberattacks and money laundering. Companies hold large amounts of sensitive data, making them obvious targets for bad actors. As with many industries, governance, compliance, and transparency are essential for fintechs as they transform the financial services landscape.

This chapter examines three common fintech use cases transforming the financial industry. First, the chapter introduces fintech's role in enhancing financial services and promoting financial inclusion, especially through digital platforms. Second, it investigates various fintech applications that support financial institution management by harnessing the power of artificial intelligence (AI) and machine learning (ML). Finally, the chapter explores fintech use cases related to the regulatory environment, including regulatory technology (regtech), blockchain technology, and cryptocurrencies. The insights presented in this chapter cater to researchers and practitioners keen on better understanding fintech's diverse applications in the ever-evolving financial industry landscape.

This chapter discusses the contributions and challenges involving regulatory technology (regtech) in financial services. It explores the salient areas where regtech can and should focus, observing existing and forthcoming industry, technology, and legal developments. This chapter outlines regtech use cases to clarify the shaping of that industry sector. It draws on developments in industry and academia, where significant research sets the tone and direction of technological solutions and regulatory drivers. A brief critical account of the benefits and challenges in regtech is offered. This chapter presents potential future directions, focusing on the salient areas of environmental, social, and governance (ESG), cryptocurrency, and decentralized compliance.

Financial technology (fintech) refers to using new technology to improve and automate the delivery and use of financial services. This chapter provides a brief introduction to fintech. It also includes the book's purpose, distinguishing features, intended audience, and structure. A synopsis of Chapters 2 through 23 is offered. The chapter concludes that fintech is constantly evolving and is reshaping finance. Fintechs offer a new paradigm of growth.

After completion of the case study, the students will be able to analyze the FinTech industry in emerging markets, distinguish the growth strategies for startups in the hyper-growth phase, using the Ansoff matrix, evaluate and select geographical markets for expansion (foreign country selection) and understand the liability of foreignness concept.

In 2015, Islam Shawky, Alain Al-Hajj and Mostafa Menessy founded Paymob in Egypt, a FinTech start-up providing technological and financial solutions to consumers and merchants in the country. The company had grown into one of Egypt’s most prominent digital payment providers by deploying infrastructure and technologies that empower the underserved with access to financial services. In 2021, Paymob had gained a lot of support from venture capital investors that ended with closing the largest in Egypt Series A fund of $18.5m led by Dubai-based venture capital firm Global Ventures. Although Paymob had already reached great success in Egypt, the founders’ vision was to become the regional leader of digital payments, focusing on small and medium-sized enterprises. So, they are considering regional markets similar to Egypt’s, such as the Kingdom of Saudi Arabia, a call with a lot of structure but a lot of competition, and Pakistan, a market with much less competition but relatively unstructured. The founders found themselves in early 2022 deciding between these two markets in preparation for the next round of Series B $50m funding.

This case study can be useful for courses in executive education.

Teaching notes are available for educators only.

CSS 3: Entrepreneurship.

This study employs an interpretivist approach to investigate how blockchain technology can transform the remittance industry.

We collected data from blockchain experts with extensive experience, compellingly demonstrating the revolutionary impact of blockchain technology on the remittance sector.

Despite experiencing rapid growth, the global remittance sector still faces challenges such as high costs and lengthy transaction times. However, blockchain technology, known for disrupting emerging industries, offers a decentralized and secure mechanism for containing, storing and managing information. By leveraging rapid block confirmations, blockchain reduces settlement times in remittance transactions, enabling value transfers between parties with just a crypto wallet.

The implications of this study are profound for theorists, as it validates existing theoretical frameworks, identifies specific pain points and explores exciting opportunities presented by blockchain technology. Additionally, we provide a roadmap for future research and innovation, bridging theory and practice and setting the stage for advancement, fostering knowledge, innovation and the successful integration of blockchain technology in the remittance industry.

Analysis highlights a unanimous consensus among experts regarding the transformative potential of blockchain technology in the remittance industry. This consensus serves as a strong impetus for practitioners to swiftly adopt blockchain-based solutions, capitalizing on opportunities such as stable coin issuance, elimination of intermediaries in foreign exchange trading, access to liquidity and the exploration of new business models. Successfully addressing challenges like congestion and limited reach will ensure seamless integration.

This research aims to determine to what extent corporate social responsibility (CSR) actions developed by bank entities in Spain improve the vulnerable customers' emotions and quality perception of the banking service. Consequently, this increases the quality of their relationship regarding satisfaction, trust and engagement.

Data from 734 vulnerable banking customers were analyzed through structural equations modeling (EQS 6.2) to test the relationships of the proposed variables.

Vulnerable customers' emotional disposition exerts a strong influence on their perceived service quality. The antecedent effect is concentrated primarily on the CSR towards the client, with a residual secondary weight on the CSR towards society. These positive service emotions are determinants of the outcome quality perceived by vulnerable customers, directly in terms of higher satisfaction and trust and indirectly through engagement.

This research contributes to understanding how financial service providers should adapt to the specific characteristics and needs of vulnerable clients by adopting a strategy of approach, personalization and humanization of the service that seems to move away from the actions implemented by the banking industry in recent years.

This study has adopted a theoretical and empirical perspective on the impact of CSR on service emotions and outcome quality of vulnerable banking customers. Moreover, banks can adopt a dual conception of CSR: a macro and external scope toward society and a micro and internal scope toward customers.