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Free banking theory, as developed in Adam Smith’s 1776 treatise, “The Wealth of Nations” is a useful tool in determining the extent to which the “invisible hand of the market” should prevail in regulatory policy. The purpose of this study is to provide a timely review of the literature, evaluating the theory’s relevance to regulation of financial technology generally and cryptocurrencies (cryptos) specifically.

The methodology is qualitative, applying free banking theory as developed in the literature to technology-defined environments. Recent legislative developments in the regulation of cryptocurrencies in the UK, European Union and the USA, are drawn upon.

Participants in volatile cryptocurrency markets should bear the consequences of inadvisable investments in accordance with free banking theory. The decentralised nature of cryptocurrencies and the exchanges on which these are traded militate against coordinated oversight by central banks, supporting a qualified free banking approach. Differences regarding statutory definitions of cryptos as units of exchange, tokens or investment securities and the propensity of these to transition between categories across the business cycle render attempts at concerted classification at the international level problematic. Prevention of criminality through extension of Suspicious Activity Reporting to exchanges and intermediaries should be the principal objective of policymakers, rather than definitions of evolving products that risk stifling technological innovation.

The study proposes that instead of a traditional regulatory approach to cryptos, which emphasises holders’ safety and compensation, a free banking approach combined with a focus on criminality would be a more effective and pragmatic way forward.

This study aims to convey the understanding of the ecosystem – how “hundi” works on the border trade between Myanmar and northern Thailand, which is an informal transfer system and is widely used as an alternative banking system. Even though the role of hundi is unable to declare the sources of money under the standard settlement of formal banking system, a failure to operate of its official mechanism are carrying using hundi, as a financial platform across the border between Thailand and Myanmar. This study surveys the best practice mechanism for the regional and international cooperation.

This paper draws on relevant literature, open-source reporting, and interviews with more than 30 interviewees on the border between Thailand and Myanmar. Interviewees includes border-trader, money changer, money transfer operators, business leaders, hundi operators, immigrant labors, government officials and commercial banking staffs.

This study provides a unique insight of hundi system, which work as the alternative mode of formal banking. It is an informal fund transfer payment platform used on the border between Thailand and Myanmar in the past five decades. It insists that hundi plays a significant role in both substitution and complementary on the trade and payment across the border of Myanmar–Thailand. Even though confronting with the barriers of financing of terrorism (anti money laundering AML/combating the financing of terrorism CFT) risk, the competition with the expanding and modernizing formal banking sector, and the introduction of Fintech and mobile money services. In the short term, these are unlikely to eliminate the hundi system completely, but may instead push hundi operators towards adopting these networks and technologies in their own operations.

This paper will be a useful source for academics, development professionals, policymakers, law enforcement agencies and business actors who are seeking to understand Myanmar’s informal payment system, hundi.

This is the latest work for border trade payment or trade financing role of hundi which has hidden under the informal market of the border for several decades. It has few research of hundi on border trade and payment, particularly after the military coup in 2021 which made hundi return to be on the spotlight and simultaneous mechanism of border trade and payment ecosystem of Myanmar. This paper will be a useful source for academics, development professionals, policymakers, law enforcement agencies and business actors who are eager to understand Myanmar’s informal payment system, hundi, especially during the hardship.

This study provides a bibliometric analysis of bank efficiency and competition over the past years (from 1993 to 2022) to (1) discover the past and current state of knowledge on bank competition and efficiency, (2) identify leading and authoritative journals and scholars who made significant contributions to the distribution of knowledge and impact, (3) identify nations that made a significant contribution and impact to the literature and (4) identify the structure of collaboration that exists between scholars in the areas of bank competition and efficiency and key thematic areas.

A total number of 868 documents made up of articles, reviews, book chapters, book and conference papers from the Scopus database were gathered. This study used a bibliometric analytic approach.

The number of documents on bank competitiveness and efficiency has increased significantly, as have their total publications, citations and national output. Additionally, the most esteemed and prestigious academic journals of eminent academics who have had a significant impact on the dissemination of knowledge on bank efficiency and competition literature champion papers on banking efficiency and competition. In terms of citation performance and collaborative efforts, the United States tops the developed countries, led by China, which is also the most productive. Additionally, single-country publications predominate in the literature, with China ranking first among the top five countries with corresponding authors. While the Lerner index, H-statistic, concentration index and market power were used to measure bank competitive behaviour, the data envelopment analysis approach predominates efficiency estimation techniques that are linked to cost, profit or revenue, scale, technical and productivity indexes.

This study is one of the first to offer bibliometric evidence of both bank competition and efficiency. It also offers proof of the distribution of knowledge and intellectual structure of the concepts and concerns in bank competition and efficiency.

Academic research has intensively analyzed the relationship between market concentration or market power and banking stability but provides ambiguous results, which are summarized under the concentration-stability/fragility view. We provide empirical evidence that the mixed results are due to the difficulty of identifying reliable variables to measure concentration and market power.

Using data from 3,943 banks operating in the European Union (EU)-15 between 2013 and 2020, we employ linear regression models on panel data. Banking market concentration is measured by the Herfindahl–Hirschman Index (HHI), and market power is estimated by the product-specific Lerner Indices for the loan and deposit market, respectively.

Our analysis reveals a significantly stability-decreasing impact of market concentration (HHI) and a significantly stability-increasing effect of market power (Lerner Indices). In addition, we provide evidence for a weak (or even absent) empirical relationship between the (non)structural measures, challenging the validity of the structure-conduct-performance (SCP) paradigm. Our baseline findings remain robust, especially when controlling for a likely reverse causality.

Our results suggest that the HHI may reflect other factors beyond market power that influence banking stability. Thus, banking supervisors and competition authorities should investigate market concentration and market power simultaneously while considering their joint impact on banking stability.

Even if digital financial services have a positive impact on financial inclusion, it creates a digital as well as gender divide within and across countries, creating regional disparity even within developing nations. Though pandemic has initiated digitalization of various services, there has been scanty research on whether digital transfer of income can improve digital financial inclusion in post-pandemic era, especially in developing countries. The purpose of the current study is to explain the regional disparity within developing countries from three regions East Asia Pacific, South Asia and Sub-Saharan Africa, using latest World Findex data, 2021.

The author takes an instrumental variable approach to run bivariate probit model to find the factors that motivate the users to make digital payments.

The study observes that electronic transfer of wages, government transfers and remittances can motivate individuals to make use of digital mode of transactions and mobile. The practice of formal saving and borrowings are the prerequisites. However, this mechanism holds good for East Asia Pacific and not for South Asia and Sub-Saharan Africa, which are poor in information and communication technology infrastructure. Women are lagging behind men, but digital transfer of wages motivate them to make digital transaction.

Digitalization of all government services and provision of affordable mobile network and internet services are necessary for regions like South Asia and Sub-Saharan Africa. In East Asia Pacific region, data protection, data governance and better regulatory framework are required. Higher female labor force participation with digital transfer of wages and empowerment with smartphones are key to reducing the Gender gap.

The current study corrects for the possible endogeneity issue, which the extant literature has not paid attention to, and provides region-specific and gender-specific policy recommendations for an improved digital inclusion.

The Central Bank of Nigeria (CBN) recently relaunched Nigeria’s cashless policy initiative which seeks to reduce financial crime and tax avoidance, decrease cash dependency, advance the adoption of digital financial services (DFS), decrease the risks to the payment system and foster financial inclusion. This study aims to identify the unique challenges of going cashless in Nigeria, particularly in terms of infrastructural, exclusionary and cost implications of the policy on the average citizens.

The author applies a doctrinal research methodology to identify and reflect on key challenges of the cashless policy from the economic, regulatory and transactional perspectives.

The cashless policy initiative in Nigeria heralds value for financial integrity, financial policy regulation and user convenience. The mode of introduction, however, ushers in significant challenges and hardly considers Nigeria’s inadequate payment infrastructure, persistent financial exclusion, low levels of financial and digital literacy and capability, high cost of using DFS and pervasive proclivity for cash. As Nigerians adjust albeit inconveniently to the policy, the CBN can ameliorate the hardship by strengthening the payment infrastructure, particularly for digital payments, fostering consumer trust by safeguarding user funds and enabling consumer preferences.

Research materials include the national regulator’s policy documents and newspaper articles that have not been published in formal reports but non-the-less adequately mirror the policy intention of the CBN and the lived experiences of Nigerians.

This study identifies the practical steps and regulatory measures that the CBN can take to improve acceptance and meaningful and sustainable adoption of the cashless policy by the majority of Nigerians.

The recommendations that are proffered provide some rich insights to inform regulatory direction for the CBN to seamlessly phase-in the cashless policy and consequently drive down financial exclusion in Nigeria.

This study contributes to the policy discussion around the introduction of the cashless Nigeria project. The doctrinal research method highlights the policy intentions of the regulator in juxtaposition with lived experiences of Nigerians. This study offers recommendations to bolster financial inclusion, stability and integrity.

This paper aims to document the impact of shadow banking on non-performing loans (NPLs) of publicly listed banks in an international setting.

This paper uses the data from 27 countries and various estimation strategies to test the arguments presented in this paper. The sample covers the period between 2002 and 2020.

The empirical results suggest that banks headquartered in countries with high shadow banking activity have fewer NPLs than otherwise similar banks headquartered in countries with low shadow banking activity. The findings remain qualitatively the same in different sub-samples and after replacing the main variables with their alternate proxies. The paper also shows that this relationship is sensitive to bank-specific characteristics. Moreover, the paper also indicates that the stringency of banking regulations weakens the relationship between shadow banking and NPLs.

The study’s data limitations prevent a detailed year-by-year analysis of NPLs and shadow banking, restricting insights into their evolving dynamics. In addition, the focus on country-level shadow banking data limits the exploration of how multinational banks’ activities in various jurisdictions impact individual banks’ NPLs.

The paper not only documents the effect of shadow banking on NPLs but also shows that the relationship between shadow banking and NPLs weakens as banking regulations become more stringent.

The purpose of this chapter is to cover banking efficiency using the concept of the Meta frontier function and to study group and subgroup differences in the production technology. This study estimates the technical efficiency (TE) and technology gap ratios (TGRs) for banks in Islamic countries. Using the assumption of the convex hull of the Meta frontier production set using the virtual Meta frontier within the nonparametric approach as presented by Battese and Rao (2002), Battese et al. (2004), and O'Donnell et al. (2007, 2008) and after relaxing this assumption, the study investigates if there is a significant difference between these two methods. To overcome the deterministic criterion addressed to nonparametric approach, the bootstrapping technique has been applied. The first part of this chapter covers the analytical framework necessary for the definition of a Meta frontier function and its estimation using nonparametric data envelopment analysis (DEA) in the case where we impose the assumption of the convex production set and follows in the case of relaxation of this assumption. Then we estimated the TE and the TGR in concave and nonconcave Meta frontier cases by applying the Bootstrap-DEA approach. The empirical part will be reserved for highlighting these methods on data bank to study the technical and technological performance level and prove if there is a difference between the two methods. Three groups of banks namely commercial, investment, and Islamic banks in 17 Islamic countries over a period of 16 years between 1996 and 2011 are used.

The present study assesses the commercial bank profit efficiency and its relationship to banking sector competition in a rapidly growing emerging economy, India from 2009 to 2019 using stochastic frontier analysis (SFA).

Lerner indices, conventional and efficiency-adjusted, quantify competition. Two SFA models are employed to calculate alternative profit efficiency (inefficiency) scores: the two-step time-decay approach proposed by Battese and Coelli (1992) and the recently developed single-step pairwise difference estimator (PDE) by Belotti and Ilardi (2018). In the first step of the BC92 framework, profit inefficiency is calculated, and in the second step, Tobit and Fractional Regression Model (FRM) are utilized to evaluate profit inefficiency correlates. PDE concurrently solves the frontier and inefficiency equations using the maximum likelihood process.

The results suggest that foreign banks are less profit efficient than domestic equivalents, supporting the “home-field advantage” hypothesis in India. Further, increasing competition drives bank managers to make riskier lending and investment choices, decreasing bank profit efficiency. However, this effect varies depending on bank ownership and size.

Literature on the competition bank efficiency link is conspicuously scant, with a focus on technical and cost efficiency. Less is known regarding the influence of competition on bank profit efficiency. The article is one of the first to examine commercial bank profit efficiency and its relationship to banking sector competition. Additionally, the study work represents one of the first applications of the FRM presented by Papke and Wooldridge (1996) and the PDE provided by Belotti and Ilardi (2018).

This paper aims to investigate the role of corporate governance on the bank profitability of Indian banks vis-à-vis South Asian Association for Regional Cooperation (SAARC) nations.

For the Corporate Governance Index, the authors examined board accountability, transparency and disclosure and audit committee, while Tobin’s Q, return on equity and return on assets are used to measure the bank’s profitability. The study used a two-stage analysis based on balanced panel data for robust findings. Sample of this study consists of 60 commercial banks from India and 60 banks from SAARC nations for the period of 2009–2021. This study used panel regression and a generalized method of moment approach using the CAMELS framework on banking industry-specific variables to determine their respective impacts.

The findings of this study suggest that board accountability is positive and significantly affects the profitability of banks as indicated by return on assets, return on equity and Tobin’s Q. In contrast, the audit committee has a positive and insignificant impact on return on assets, return on equity and Tobin’s Q, while transparency and disclosure have a negative and significant impact on these metrics. Furthermore, the country dummy result shows a significant positive impact on all the bank performance parameters, implying that Indian banks have the highest degree of convergence with corporate governance as compared to other SAARC nations.

This study provides insight to the regulators, policymakers and financial institutions to evaluate the role of corporate governance in emerging economies. However, the findings of the study should be interpreted with caution, as the results are sensitive to the disparity between India and other SAARC nations' government policies, climatic circumstances and cultural or religious traditions.

To the best of the authors’ knowledge, this is the first attempt to gauge the performance of Indian banks vis-à-vis SAARC nations using the CAMELS framework approach. Further, findings of this study suggest some novel evidence tying corporate governance quality with the profitability of banks among SAARC nations.