Technology-Driven Innovations in Financial Services: The Rise of Alternative Finance

Gąsiorkiewicz Lech (), Monkiewicz Jan () and Monkiewicz Marek ()
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Gąsiorkiewicz Lech: Warsaw University of Technology, Faculty of Management, Warsaw, POLAND
Monkiewicz Jan: Warsaw University of Technology, Faculty of Management, Warsaw, POLAND
Monkiewicz Marek: Main School of Commerce, Institute of Risk and Insurance, Warsaw, POLAND

Foundations of Management, 2020, vol. 12, issue 1, 137-150

Abstract: Financial systems worldwide are increasingly experiencing the mounting pressure of the technology-based financial innovations. Some of these developments are generating alternative financial structures existing parallelly to the “old” ones, whereas some others are simply replacing the “old” ones. Alternative intermediating institutions are gaining ground vis-à-vis incumbents, relying on their technological and market supremacy. The space of traditional financial intermediation requires new solutions to be more competitive. Some technological solutions provide additionally for the partial or entire disintermediation of the financial services, thus removing some existing transaction costs and matching directly economic agents. Digitalization and datafication, coupled with artificial intelligence, are offering immense new operational opportunities and economic benefits. On the other hand, they are also the source of new risks to the financial and economic systems, financial stability, national security, and consumer well-being, which need to be properly addressed. We review in this paper principal components of the current stream of technology-based financial innovations and their main drivers, as well as discuss major strategic issues and impacts that we are facing in this area.

Keywords: alternative finance; financial innovations; FinTech; technology enablers; digitalization; financial consumer protection (search for similar items in EconPapers)
JEL-codes: G21 G22 G23 (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:vrs:founma:v:12:y:2020:i:1:p:137-150:n:11

DOI: 10.2478/fman-2020-0011

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