Synergistical effects of Knowledge Management and FinTech Adoption on Sustainable Performance of Banks in Pakistan: The moderating role of Digital Literacy

The main objective of this research was to examine the influence of knowledge management on the sustainable performance of financial institutions, specifically banks, in Pakistan. Additionally, the study explored the mediating role of FinTech Adoption and moderating impact of digital literacy on the relationships between knowledge management and sustainable performance in Pakistan’s banking sector. This research adopts a quantitative approach; data was collected from bank employees and managers. A structured questionnaire was used for data collection and data is collected from 384 respondents of the study. The study employs Partial Least Squares Structural Equation Modeling (PLS-SEM) using SMART PLS 4 to validate the proposed research model and test the hypotheses. The results indicate that knowledge management and FinTech adoption significantly affect the sustainable performance of banks. Moreover, digital literacy plays a moderating role in strengthening these relationships. The study provides valuable insights for banking institutions and policymakers, highlighting the importance of knowledge management and FinTech adoption in driving sustainability. It also emphasizes the role of digital literacy in enhancing these effects, suggesting the need for training programs to improve digital competencies in the banking sector. Practically, this study will be useful to bankers, banks, policymakers and bank authorities to develop such agencies that improve sustainable performance of banking sector. Theoretically, this study add value in the existing literature with respect to Knowledge Management Theory (KMT) and Financial Innovation Theory (FIT) because all the organization consider technologies and knowledge as assets of the company and utilize it to improve the overall sustainable performance of the banking sector, in Pakistan. This research contributes to the existing literature by integrating knowledge management, FinTech adoption, and digital literacy into a single framework, offering a novel perspective on sustainable performance in the banking sector of Pakistan.