Abstract
Abstract. The article considers the growing trends and specifics of digitalization of the banking sector. The main directions of digital transformation and the emergence of new financial market players due to the institutionalization/symbiosis of traditional banks with technology firms are studied. It is noted that this process can have far-reaching and ambiguous consequences and threats, such as moving away from the model of perfect competition and transition to platform-based competition, monopolizing markets by displacing some firms and creating favorable conditions for others, financial and reputational risks for banking structures, which provide payment cards, increase advertising prices, etc. The identified problems of traditional (classical) banks — sluggishness, impossibility of prompt adjustment of strategies, the use of outdated development tools, in particular, the closure of branches and the use of outdated technologies, loss of control over the payment system;the thesis is substantiated according to which the mechanisms of their functioning and management need cardinal corrections and innovations, first of all in approaches to interaction with clients and realization of e-business. Outlined strategies for the operation of new digital banks — the introduction of digital operations with a focus on efficiency, accessibility, transparency and consumer protection, increasing competition with traditional banks with the acquisition of customers of the latter.The consequences and prospects of the arrival of high-tech companies Apple and Google in the banking market are analyzed. Specific examples show the reasons for the bankruptcy of the previously prosperous companies Kodak (USA), Blockbuster (USA). The authors argue that digital banking is gaining a global character and the effective operation of national financial structures requires taking into account the threats and lessons of the onset of high technologies in practice. The features of the development of a digital bank on the European continent and in the United States have been clarified. Keywords: digital banking, digitalization, traditional banks, fintech, cashback, blockchain, smart contracts, cloud technologies. JEL Classification G21, O33, F65 Formulas: 0; fig.: 0; tabl: 0; bibl.: 29.
Highlights
The global nature of cyberspace determines the need to create the latest formats of digital banking
Digital banking has emerged due to increased consumer demand for more efficient and secure ways to conduct financial transactions and access bank accounts, which cannot be provided by traditional banking institutions
Today’s traditional banks are sometimes associated with rudimentary phenomena such as CDs, travel agencies located on the main streets, clumsy tankers or attempts to catch a taxi in the rain [9]
Summary
The global nature of cyberspace determines the need to create the latest formats of digital banking. Strategies for the development of new financial market participants are based on the use of the latest information and communication technologies, the provision of digital services and close interaction with customers in the context of digitalization of business management and its prospects/consequences. On April 20, 2021, MasterCard acquired Ekata for 850 million US dollars, which made it possible to identify online the person carrying out the transaction in real time, and — insurance of funds transfers through accounting for various indicators that may indicate fraudulent activities [12] Another example is the creation of a strategic alliance of global corporate technology providers for the financial industry NCR Global (USA) and Google on the Google Cloud platform, in which the former will expand the cloud availability of its digital banking software portfolio, including retail banking services and platform for NCR Authentic card and payment processing [13].
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