Digital Risk and Financial Inclusion: Balance between Auxiliary Innovation and Protecting Digital Banking Customers

Faraz Ahmed, Arsalan Hussain, Sajjad Nawaz Khan, Arsalan Haneef Malik (), Muhammad Asim, Sadique Ahmad and Mohammed El-Affendi
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Faraz Ahmed: College of Business Management, Institute of Business Management, Karachi 75300, Pakistan
Arsalan Hussain: College of Business Management, Institute of Business Management, Karachi 75300, Pakistan
Sajjad Nawaz Khan: Department of Business Administration, Iqra University, Main Campus, Karachi 75500, Pakistan
Arsalan Haneef Malik: College of Business Management, Institute of Business Management, Karachi 75300, Pakistan
Muhammad Asim: EIAS Data Science Lab, CCIS, Prince Sultan University, Riyadh 11586, Saudi Arabia
Sadique Ahmad: EIAS Data Science Lab, CCIS, Prince Sultan University, Riyadh 11586, Saudi Arabia
Mohammed El-Affendi: EIAS Data Science Lab, CCIS, Prince Sultan University, Riyadh 11586, Saudi Arabia

Risks, 2024, vol. 12, issue 8, 1-21

Abstract: The digital economy’s rise has fueled the growth of digital banking, but concerns linger about customer protection. While offering advantages like financial inclusion, this shift disrupts traditional banking experiences and introduces potential risks. Customer safety in this new landscape is paramount, as dissatisfied users may switch providers and institutions risk reputational damage. To remain competitive, financial institutions must prioritize a secure experience that aligns with customer expectations. This study investigates five key factors influencing customer protection in Pakistan’s digital financial services. Analysis reveals all factors positively impact customer protection, with information security holding the most weight. These findings highlight the need for robust information security measures as a critical driver for the Pakistani digital banking industry’s success.

Keywords: digital risk; financial inclusion; customer protection; risk management; digital banking (search for similar items in EconPapers)
JEL-codes: C G0 G1 G2 G3 K2 M2 M4 (search for similar items in EconPapers)
Date: 2024
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