HOW FINTECH IS DOING INNOVATIONS AND EFFICIENCY IN THE BANKING SECTOR?

Purpose - the purpose of the research is to examine the impact of fintech on bank efficiency in the Asian banking industry, where bank efficiency has been measured using the DEA (data envelopment analysis) approach for technical efficiency as a proxy. Methodology - the methodology of the research includes the sample consisting of 92 privatized commercial Asian banks from 2016-2022 and uses cross-country analysis. The panel regression models have been utilized, consisting of a fixed effect model. The model has run after the diagnostic check and the data validation has been satisfied with the stationary, serial autocorrelation, heteroscedasticity, homogeneity and multicollinearity issues. Results - The results show that fintech funding has a significantly positive effect on bank efficiency. Based on the results, it concludes that fintech funding is doing innovations using funding and improving efficiency in Asian banks. Implication - the implication derived from the empirical evidence of the study is that fintech funding brings innovations that positively consequence on bank efficiency in Asian banks. Limitation - the limitation of the study is that there was no data available before 2016 since fintech was a new technology during the time.