Research On The Influence Of Fintech On The Profitability Of Commercial Banks

As the main institution of the state to regulate the economy and achieve financial integration,commercial banks are in a dominant position in the market.They are confronted with such problems as lack of innovation consciousness and motivation,single types of products and services,and incomplete asset allocation structure.The rise and development of Fintech brings opportunities and challenges to the development of traditional financial system.New technologies such as big data,cloud computing,block chain,artificial intelligence and Internet improve the efficiency of consumers in receiving financial services and promote the development of inclusive finance.At the same time,with the Fintech enterprises entering the financial market,commercial banks are facing the market competition,brought by the new business model.It is particularly important for commercial banks to cope with the impact of Fintech and make full use of the development opportunities brought by Fintech.One of the preconditions to solve this problem 1s to clarify the impact of Fintech on the profitability of commercial banks,which 1s exactly the problem to be solved in this paper.This paper analyzed the financial theory of commercial banks profit model based on Fintech,combining the current situation analysis of the development of Fintech and the profits of the commercial banks.Then,this paper take 16 China listed commercial banks as the research sample,and applied data from 2011 to 2017,using co-integration analysis and regression analysis to empirically test the impacts of Fintech on commercial bank profitability and profit model.The empirical study reveals that,Fintech financing,financial industry application of science and technology development,the Internet third-party payment,Internet insurance both have certain negative effect in commercial bank profitability and profit model.And the impact of Fintech financing,third-party payment and Internet insurance on commercial bank profitability have been tested significantly.Therefore,the development of Fintech has indeed impacted the development of traditional business model of commercial banks and had an impact on their profitability.Based on the research results,this paper puts forward policy suggestions for commercial banks to improve profits facing the impact of financial technology.Firstly,they should adjust their income structure to cope with the impact of third-party payment.Secondly,commercial banks could expand the business model and promote the application of financial techno logy.Finally,commercial banks should strengthen their risk management and give full play to the advantages in risk control.Under the background of promoting the development of Fintech and guarding against financial risks,this paper explored the relationship between Fintech and profitability of commercial banks,and provided new ideas for commercial banks to enhance their own profitability,strengthen the integration of Fintech and realize the transformation.Based on the innovative thinking of the essence of Fintech,this paper quantitatively measured the development of Fintech by using relevant data such as Fintech finaneing,financial industry application of science and technology development,the Internet third-party payment,Internet insurance,and combined qualitative analysis to explore the relationship between commercial bank profits and Fintech.This study is an effective supplement to the research on Fintech and commercial banks,and provides practical evidence support for the impact of Fintech on profitability of commercial banks.