Digital Transformation in Banking: Drivers, Disruptive FinTech Models, Risk Mitigation, and Socio-Economic Impacts

Abstract

This study analyzes banking digital transformation via five core pillars aligned with the journal’s scope: digital adoption drivers in traditional banks, FinTech’s disruptive models and competitive impact, risk management for cyber threats/data privacy, shifts in consumer behavior (mobile banking, robo-advisory), and policy/socio-economic implications (financial inclusion, cross-border regulation). Using mixed methods—quantitative data from 120 global banks (2020–2023) and qualitative case studies of FinTechs (Ant Group, Revolut, Chime)—it identifies success factors: strategic partnerships, agile governance, customer-centric innovation. Findings: digital transformation cuts early adopters’ transaction costs by 23% on average and reaches 1.2 billion unbanked adults globally by 2023, but raises systemic risks (algorithmic bias, regulatory arbitrage). It concludes with regulator recommendations to balance innovation and stability, and insights for banks to sustain competitiveness.

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