Navigating fintech and banking risks: insights from a systematic literature review

Abstract

This study presents a comprehensive systematic literature review (SLR) of research on the relationship between financial technology (fintech) and bank risk. A total of 1837 articles were reviewed in WOS and Scopus from 2019–2023. The Reporting Standards for Systematic Synthesis of Evidence (ROSES) were used to identify 28 high-quality articles that robustly analyse the relationship between fintech and bank risk. This study categorizes fintech measures into bank-level (financial innovation, use of online channels), country-level (digital finance index, commercial bank digital transformation index), and fintech keywords (social media platforms, documents). It identifies four main bank risk themes: insolvency, credit, market, and liquidity risk. The review also highlights mediating variables such as operational efficiency, the capital adequacy ratio, and the net interest margin and moderating variables such as digital transformation, financial regulation, and economic uncertainty. Our findings highlight three key insights. First, most research does not mention theory, which suggests an integrated multitheoretical approach. Second, there is a notable gap in cross-country research on this topic. We recommend that future studies focus on comparative cross-country analysis to provide broader insights into the fintech–bank risk nexus. Third, the relationship between fintech and bank risk has received increasing academic interest, with more scholars utilizing interdisciplinary methods, expanding the geographical scope, and addressing emerging risks. This SLR provides valuable insights for researchers, policymakers, and industry practitioners to equip them with the knowledge to improve financial stability and strengthen risk management strategies in the evolving banking sector.