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

In recent years,under the background of a new round of scientific and technological revolution and industrial transformation,financial science and technology develops rapidly.On January 12,2022,the State Council issued the 14 th Five-Year Plan for the Development of the Digital Economy,stressing the need to take innovation-driven development as the development direction,improve the level of financial technologies,and steadily promote the development of financial technologies.As an important part of the traditional financial system,the business model and profitability of commercial banks are inevitably impacted and challenged by the financial technology.In the context of the rapid development of financial science and technology,analyzing the specific impact of financial science and technology on the profitability of commercial banks will help our commercial banks actively respond to the impact of financial technology,achieve transformation and upgrading,improve profitability,and at the same time play a positive role in promoting the transformation and healthy development of the entire financial industry.Firstly,this paper combs the relevant literature,and defines and summarizes the relevant concepts and theoretical basis of financial technology and the profitability of commercial banks,which lays the theoretical foundation for this paper;secondly,through the historical review of the development process of financial technology,this paper analyzes the profitability of various businesses of China’s financial technology and commercial banks,and analyzes the mechanism of the impact of financial technology on the profitability of commercial banks from the perspectives of asset side,liability side and intermediary business respectively,so as to lay a realistic foundation for this paper;thirdly,this paper uses the data of 16 commercial banks such as Industrial and Commercial Bank,China Merchants Bank and Ping An Bank from 2011 to 2020 as research samples to empirically study the relationship between financial technology and the profitability of commercial banks by using fixed-effect models,and the empirical results show that:(1)There is a significant positive correlation between financial technology and the profitability of commercial banks,the better the financial technology development is,the more conducive to the transformation and upgrading of commercial banks,the better the positive role of financial technology development,and the promotion of profitability;and(2)The heterogeneity of financial technology in the enhancement of the profitability of commercial banks with different asset scales.Compared with small and medium-sized joint-stock commercial banks,the role of financial technology in promoting the profitability of large state-owned banks is more obvious.Large stateowned commercial banks have strong competitive advantages in business scale,capital strength and so on,and are better able to cope with the impact of financial technology.At the same time,large state-owned banks can make use of their resources scale advantage and platform advantage to follow the pace of development of financial technology and better enhance their profitability.Finally,on the basis of theoretical and empirical research,this paper puts forward corresponding countermeasures and suggestions from the perspective of commercial banks and regulatory agencies.The specific contents at the level of commercial banks include: adjusting the business philosophy,optimizing the mode of revenue,strengthening the cooperation with financial technology companies,improving the quality of financial technology talents and improving the risk prevention mechanism for financial technology;the specific contents at the level of regulatory authorities include: strengthening the risk supervision of financial institutions,improving the relevant laws and regulations on financial technology supervision,and guiding the coordinated development of financial technology companies and the traditional banking industry.