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World Experience In The Introduction Of Modern Innovation And Information Technologies In The Functioning Of Financial Institutions

Author

Listed:
  • Olha Popelo

    (Chernihiv Polytechnic National University, Ukraine)

  • Maksym Dubyna

    (Chernihiv Polytechnic National University, Ukraine)

  • Nataliia Kholiavko

    (Chernihiv Polytechnic National University, Ukraine)

Abstract

The article reveals the essence of the concept of "financial innovations" and their features. The classification of financial innovations is given. The innovative models of the Ukrainian banking business development are analysed. The innovative developments of the world’s leading banks are systematized according to the version of the annual competition for the BAI-Finance Global Banking Innovation Awards held in Las Vegas. The innovative and information technologies in the work of financial institutions in the following areas are analysed: Product and Service Financial Innovation, Channel Financial Innovation, Financial Innovation in Social and Community Impact, Financial Innovation in Internal Process Improvement. Foreign experience and features of the development of the newest innovative information technologies in the financial services market are analysed. The subject of research is theoretical and applied aspects of the development of innovations and information technologies in the functioning of world-class financial institutions. The purpose of the article is to analyse and systematize foreign experience in the development of new innovative and information technologies in the financial services market. In the research, the authors used general scientific and specific methods, including: historical-logical, dialectical, deductive, analysis and synthesis, grouping, abstraction and formalization, benchmarking, generalizations and systematization. The article concludes that in modern rapidly evolving digitalization processes, financial innovations play an extremely important role and contribute to the economic development of countries. The authors point out that banking institutions need to focus their potential as much as possible on identifying priority digital and innovative initiatives, taking into account current challenges and threats. Finally, the effective use of specific financial innovations requires in-depth knowledge of the features of their operation and careful analysis of their consequences. The authors recommend the use of a cross-functional approach, which provides flexibility and the ability to transform change over time and is an important element in the process of implementing financial innovations. Taking into account the experience of leading banking institutions that actively implement innovative developments, the authors note that along with the benefits, financial innovations can cause new challenges and threats for all participants in this process. Researchers have shown that radical innovation can displace a dominant business model or technology and create a new market. According to the results of the analysis of innovative developments of banks around the world for the period 2015-2019, the authors found that financial innovations have changed their nature and are based on the latest digital technologies.

Suggested Citation

  • Olha Popelo & Maksym Dubyna & Nataliia Kholiavko, 2021. "World Experience In The Introduction Of Modern Innovation And Information Technologies In The Functioning Of Financial Institutions," Baltic Journal of Economic Studies, Publishing house "Baltija Publishing", vol. 7(2).
    • Handle: RePEc:bal:journl:2256-0742:2021:7:2:21
    DOI: 10.30525/2256-0742/2021-7-2-188-199
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    References listed on IDEAS

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    1. Svetlana Saksonova & Irina Kuzmina-Merlino, 2017. "Fintech as Financial Innovation - The Possibilities and Problems of Implementation," European Research Studies Journal, European Research Studies Journal, vol. 0(3A), pages 961-973.
    2. Yao, Meifang & Di, He & Zheng, Xianrong & Xu, Xiaobo, 2018. "Impact of payment technology innovations on the traditional financial industry: A focus on China," Technological Forecasting and Social Change, Elsevier, vol. 135(C), pages 199-207.
    3. Lee, Chien-Chiang & Wang, Chih-Wei & Ho, Shan-Ju, 2020. "Financial innovation and bank growth: The role of institutional environments," The North American Journal of Economics and Finance, Elsevier, vol. 53(C).
    4. Hahn, Katrin, 2019. "Innovation in times of financialization: Do future-oriented innovation strategies suffer? Examples from German industry," Research Policy, Elsevier, vol. 48(4), pages 923-935.
    5. Senyo, PK & Osabutey, Ellis L.C., 2020. "Unearthing antecedents to financial inclusion through FinTech innovations," Technovation, Elsevier, vol. 98(C).
    6. Kapetaniou, Chrystalla & Samdanis, Marios & Lee, Soo Hee, 2018. "Innovation policies of Cyprus during the global economic crisis: Aligning financial institutions with National Innovation System," Technological Forecasting and Social Change, Elsevier, vol. 133(C), pages 29-40.
    7. Nataliya Kholiavko, 2017. "Systematization Of Scientific Approaches To The Interpretation Of Information Economy," Baltic Journal of Economic Studies, Publishing house "Baltija Publishing", vol. 3(4).
    8. Serhiy Shkarlet & Maksym Dubyna & Olena Zhuk, 2018. "Determinants Of The Financial Services Market Functioning In The Era Of The Informational Economy Development," Baltic Journal of Economic Studies, Publishing house "Baltija Publishing", vol. 4(3).
    9. An, Hui & Yang, Ruibo & Ma, Xuejiao & Zhang, Siqi & Islam, Sardar M.N., 2021. "An evolutionary game theory model for the inter-relationships between financial regulation and financial innovation," The North American Journal of Economics and Finance, Elsevier, vol. 55(C).
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    Cited by:

    1. Khanin Semen & Kovalchuk Svitlana & Yakymova Nataliia & Harvat Olha & Taranych Andrii, 2023. "Modeling the Influence of Intellectual and Innovative Determinants on the Economic Systems’ Development in the Conditions of the Creative Economy Formation," Management Theory and Studies for Rural Business and Infrastructure Development, Sciendo, vol. 45(2), pages 133-141, June.
    2. Li, Hui & Usman, Nazar & Coulibay, Megnoro Hamed & Phiri, Ruth & Tang, Xiaoying, 2022. "Does the resources curse hypothesis exist in China? What is the dynamic role of fiscal decentralization, economic policy uncertainty, and technology innovation for sustainable financial development?," Resources Policy, Elsevier, vol. 79(C).
    3. Huifang E & Shuangjie Li & Liming Wang & Huidan Xue, 2023. "The Impact of ICT Capital Services on Economic Growth and Energy Efficiency in China," Energies, MDPI, vol. 16(9), pages 1-21, May.
    4. Havrylchenko Olena & Polozova Tetiana & Bilyk Victoria & Pokanievych Yurii & Larionova Katerina, 2023. "Innovation-Investment Mechanism of the Economicentities Development in the Conditions of Transformational Challenges," Management Theory and Studies for Rural Business and Infrastructure Development, Sciendo, vol. 45(4), pages 343-351, December.
    5. Zhu, Mingqi, 2023. "Validating resources curse hypothesis in US: Exploring the relevancy of financial market risk and technology innovation," Resources Policy, Elsevier, vol. 84(C).
    6. Popelo Olha & Dubyna Maksym & Kholiavko Nataliia & Panchenko Olena & Tarasenko Artem, 2022. "Features of the Transformation of the Regional Models of the Households’ Financial Behavior," Management Theory and Studies for Rural Business and Infrastructure Development, Sciendo, vol. 44(1), pages 117-124, March.

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    More about this item

    Keywords

    financial institutions; financial market; financial innovations; in-novation; information technologies; Fintech; digital technologies; bank; credit institu-tions; business models;
    All these keywords.

    JEL classification:

    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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