The impact of bank FinTech on liquidity creation: Evidence from China

Pin Guo and Cheng Zhang

Research in International Business and Finance, 2023, vol. 64, issue C

Abstract: This paper examines whether and how bank FinTech affects liquidity creation. Using panel data from Chinese commercial banks over the period 2008–2019 and bank-level FinTech indices constructed by a textual analysis method, we find robust evidence that banks with greater FinTech development create more liquidity for the public. This effect operates through deposit inflow, risk management, and cost efficiency channels. Furthermore, we find that the positive effect of bank FinTech on liquidity creation is more pronounced for banks with non-state ownership, unlisted status, and less liquidity creation.

Keywords: FinTech; Commercial bank; Liquidity creation (search for similar items in EconPapers)
JEL-codes: G21 G32 M15 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (12)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:riibaf:v:64:y:2023:i:c:s0275531922002446

DOI: 10.1016/j.ribaf.2022.101858

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