Economics at your fingertips  

Relationship banking and information technology: the role of artificial intelligence and FinTech

Marko Jakšič () and Matej Marinč ()
Additional contact information
Marko Jakšič: University of Ljubljana
Matej Marinč: University of Ljubljana

Risk Management, 2019, vol. 21, issue 1, No 1, 18 pages

Abstract: Abstract Banks have no time for complacency. They need to re-evaluate their competitive advantages in light of profound changes driven by advances in information technology (IT) and competitive pressure from FinTech companies. This article emphasizes that banks should not abolish relationship banking, which nurtures close contact with bank customers. A long-term orientation of relationship banking streamlines incentives and supports the long-term needs of bank customers. However, banks might be lured into transaction banking due to the presence of IT-driven economies of scale and competition from FinTech start-ups and IT companies. In this light, the article evaluates the role of distances, artificial intelligence, and behavioral biases. Implications for stability in banking are explored. We argue that relationship banking can overcome its drawbacks, but it needs to adjust to the new reality in order to survive.

Keywords: The future of banking; Relationship banking; Information technology; Artificial intelligence; FinTech (search for similar items in EconPapers)
JEL-codes: G20 G21 L86 O33 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link) Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Ordering information: This journal article can be ordered from

DOI: 10.1057/s41283-018-0039-y

Access Statistics for this article

Risk Management is currently edited by Igor Loncarski

More articles in Risk Management from Palgrave Macmillan
Bibliographic data for series maintained by Sonal Shukla ().

Page updated 2020-05-16
Handle: RePEc:pal:risman:v:21:y:2019:i:1:d:10.1057_s41283-018-0039-y