Impact of digital technology on banking business in Southeast Asia countries

Abstract

This article studies the bank's operations on digital platforms using panel data from 2010 to 2020 of five Southeast Asian countries: Indonesia, Malaysia, Myanmar, Thailand and Vietnam. The Pooled regression model (POOL), Fixed effect model (FEM), Random effect model (REM) were applied to the study to consider the impact of variables on the number of digital banking transactions, the total value of banking transactions conducted by telephone and telecommunications networks, the number of card accounts opened at the bank to the bank's deposit and loan turnover. The results of this study showed that the number of digital banking transactions and, the total value of banking transactions conducted by via telephone and telecommunications networks contribute to the increase in the bank's deposit and lending turnover. As such, the regression model shows that ease of interaction, decision support tools, customer care opportunities as well as flexibility in conducting online transactions to a large extent affect has a positive impact on customer relationships between banks, and has a positive impact on the business activities of banks in Southeast Asia. Digital banking services must attract and maintain customers' attention. Policy proposals promote the development toward a larger banking industry and focus on the effectiveness of digital banking applications.