Research on Technological Innovation and Optimization Strategies in the Digital Transformation of Small and Medium-Sized Financial Institutions

Given the background of rapid fintech development, digital transformation has been one of the vital approaches toward elevating market competitiveness for small-and-medium-sized financial institutions as well as improvements in operational efficiencies. However, due to the limited financial resources, technologies, and related management capabilities available with the smaller and medium-sized financial institutions, there are a number of challenges that are faced by such institutions during the transformation. A model of technological innovation was constructed within this paper to assess quantitatively the influence of technological innovation on satisfaction, loyalty, revenue, and market share of customers in small-and-medium-sized financial institutions. The results of the study indicate that technological innovation may enhance satisfaction and loyalty toward customers, increasing revenues and market share. In addition, based on the empirical results, this paper puts forward further optimization proposals for technological innovation, management reform, and market positioning from the perspective of helping small-and-medium-sized financial institutions that have digital transformation and core competitiveness increasing technological and managerial bottlenecks. This study can be a basis for theoretical elaboration and practical reference for the digital transformation of small and medium-sized financial institutions, and it also enriches the connotation dimension that the synergy between technological innovation and management reform takes in fostering advances in future research.