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JEL Classification:

G18, G21, G24, G28

Abstract

Technology in financial services, or ‘fintech’, entrants and technology-media-telecommunication companies have rapidly evolved into the traditional banking industry, offering customer-centric, faster-easier-convenient-free, financial services. Digital-only-neo-banks are focused on payment, money transfer, lending for small-medium-businesses, and microfinancing, facilitating technological innovation such as digital wallet and messaging peer-to-peer transactions. Fintech banks generally lack the scale and the trust, unregulated in some cases with credit or liquidity risk exposure, from the customers perspective. Fintechs are increasingly perceived as a partner for a source of value creation through technological advances and innovations to the large, traditional, and incumbent banks moving to accelerated digital transformation. All innovative technologies which have laid the groundwork for major disruption in the current digital banking revolution, set forth unimagined trajectory of collaboration and consolidation as fintech industry begins to mature. This review updates the digital banking transformation in fintechs and incumbent banking institutions to show that access to future fintech trends will grow significantly in coming years. The combined findings suggest that digitalised-mobile- banking transitions emphasize the capabilities of banking infrastructure for data sharing, connectivity, stability and cybersecurity and standardisation of internal and external APIs as progress continues within the regulatory framework of data protection as part of the privacy act and open-banking directives.

Keywords:

Retail Banking, FinTech, Artificial Intelligence (AI), Data Sharing, Application Programming Interface (API), Data Protection Regulation