Demand For Financial Services Research Articles

Research on the Transformation and Development of Investment Bank FICC Business of CITIC Securities Company Limited

In the current financial environment, with the continuous expansion of China's economic output and the continuous expansion of demand for financial services, the mutual influence of the international market is gradually deepening. Deepening the development of FICC business has become the core breakthrough point for the high-quality development of securities companies. Since its development, the FICC business (i.e. capital intermediary business) under the investment banking system of CITIC Securities has been involved in fixed income, foreign exchange, commodities, etc. However, there is still a significant gap in its development compared to international investment banks. Taking the current research status of FICC business at home and abroad as the background, taking CITIC Securities Company as an example, analyze the development status of its FICC business from multiple perspectives. Analyze the development bottlenecks in various aspects such as overall capital scale, traditional business and internationalization level, talent team structure, and technological innovation ability, and propose targeted solutions to improve the risk management system, expand the FICC business chain, accelerate technology investment, improve organizational structure, and leverage synergies to promote the transformation and development of CITIC Securities' FICC business and support the high-quality development of the securities and finance industry.

Efektivitas Pengawasan Syariah Dalam Menjamin Kepatuhan bank Syariah

Islamic banking in Indonesia has experienced significant growth in recent years, driven by the increasing demand for financial services that comply with Sharia principles and laws. The role of the Sharia Supervisory Board (SSB) is crucial in monitoring and evaluating the compliance of Islamic banks with Sharia principles. This study aims to analyze the effectiveness of Sharia supervision by the SSB in ensuring the operational compliance of Islamic banks with Sharia principles. The research method used is a literature study, collecting and analyzing data from various written sources such as books, journals, and related documents. The findings of the study indicate that the effectiveness of SSB supervision is influenced by the qualifications and understanding of SSB members on fiqh muamalat and modern Islamic finance. Additionally, the SSB plays a role in ensuring that the products and services offered by Islamic banks adhere to Sharia principles through the evaluation of contract structures, transaction mechanisms, fund usage, and profit distribution mechanisms. With effective supervision from the SSB, it is expected that Islamic banking can continue to grow and gain public trust. This research contributes to the development of knowledge and practice in the field of Islamic banking.

THEORETICAL ASPECTS OF THE ACTIVITIES OF FINANCIAL INTERMEDIARIES IN UKRAINE

Purpose. Analysis of modern approaches to defining the essence of financial intermediaries, highlighting their main functions and classifications. Methodology. The research is based on dialectics as a scientific and philosophical method of cognition, a systemic approach and an analytical method. When conducting the research, the methods of comparative analysis, system-structural, generalization, economic-statistical, abstract-logical, monographic, methods of analysis and synthesis were used. Results. Modern approaches to defining the essence of financial intermediation and its role in the financial market have been studied. It was determined that financial institutions that, in the course of their professional activity, either accumulate temporarily free funds of economic entities and use them to satisfy the demand for financial services of financial market participants, or provide services to the financial market, should be related to financial intermediaries. The views of modern scientists on the role of financial intermediaries are summarized. Among the main functions, the following are highlighted: redistribution and reduction of risks; provision of alternative ways of financing economic activities and consumer needs of citizens; accumulation of funds of business entities; achievement of effective investments by market participants; ensuring effective redistribution of capital: promoting the development of the financial market and its infrastructure; management of payment systems. Approaches to modern classification of financial intermediaries are considered.Attention is focused on the classification of financial intermediaries, according to the bank-oriented model of financial mediation in force in Ukraine. Practical significance. The results of the research consist in the possibility of practical use of the obtained conclusions to improve the activities of financial intermediaries in the financial market of Ukraine.

Predicting Financial Inclusion in Peru: Application of Machine Learning Algorithms

Financial inclusion is a fundamental and multidimensional matter that has acquired importance on the global agenda in recent years. In addition, it is still a source of great interest and concern for lawmakers, international organizations, scholars, and financial institutions worldwide. In that regard, this research focuses on Peru to assess the country’s financial inclusion condition, which continues to face significant hurdles in providing financial services to its whole population despite economic improvement. The aim of this article is twofold, based on recent data on demand for financial services and financial culture in the country: (1) to empirically test how machine learning methods, such as decision trees, random forests, artificial neural networks, XGBoost, and support vector machines, can be a valuable complement to standard models (i.e., generalized linear models like logistic regression) for assessing financial inclusion in Peru, and (2) to identify the most influential sociodemographic factors on financial inclusion assessment in the country. The results may catalyze the integration of machine learning techniques into the Peruvian financial system, garnering the interest of finance researchers and policymakers committed to augmenting financial access and utilization among Peruvian consumers.

Fintech Adoption: A Study of Users in the Guangdong-Macao In-Depth Cooperation Zone in Hengqin (China)

Intended as an economic and development hub, the Hengqin Cooperation Zone aims to foster collaboration and integration between mainland China, Hong Kong, and Macao, serving as a platform for economic development and innovation among the three regions. The zone's development has increased demand for financial services, often offered through fintech. There is, however, a lack of interoperability between the fintech services currently used in Macao and Hengqin. This may hinder Macao users' adoption of the technology. Thus, our research objective is to identify the factors determining Macao residents' adoption of fintech services in the area and provide insights for service providers, developers, and policymakers. A framework based on the Technology Acceptance Model (TAM) and Theory of Planned Behavior (TPB) was used for this purpose. The responses of 103 Macao residents provided evidence that ease of use significantly and positively impacts the usefulness of the technology. This in turn influences attitudes towards fintech usage. Subjective norms and perceived behavioral control positively impact fintech adoption intentions. The fintech industry and the governments of Macao and Hengqin can work on improving technology's ease of use and usefulness. They can also promote them to Macao users, and provide the resources required for better access to fintech in the zone.

Exploration of Mechanisms and Paths of Fintech Enabling High-Quality Development of Rural Finance

In modern society, rural areas still occupy a vast population and land resources, but have long been plagued by insufficient financial services, With the development of society, the demand for financial services from rural residents and enterprises has gradually increased, and this growth in demand has given rise to the application of financial technology in rural finance. Moreover, along with the rise of the global wave of digitalization, the popularization of smartphones, the expansion of Internet coverage, and the development of digital payment technology have created favorable conditions for the application of fintech in rural areas, and rural residents have more digital channels to access financial services. Based on this, the article conducts research on the mechanism of fintech-enabled rural finance, elaborates in detail on the cooperation between fintech and financial institutions and fintech innovation, and focuses on the path of fintech-enabled rural finance high-quality development, to provide some suggestions for your reference.

Взаимосвязь образования и финансового поведения

The article considers the issue of the relationship between higher education and financial behavior of citizens of the Russian Federation. The points of view formed in the scientific literature on the factors determining the rationality of financial behavior. In addition, the role of education and training as a tool for the formation of responsible financial behavior of the population are presented. The observed manifestation of financial behavior was the demand for financial services provided by the Central Bank of the Russian Federation, as well as data on the availability of higher education, which were reflected in the All-Russian Population Census of 2020. As a result of the study, five groups of indicators were formed: accounts of individuals; placement of funds by individuals; loans /loans of individuals; payment services; insurance. The calculations were carried out in the context of the Federal Districts of the Russian Federation and allowed us to identify the following connections: strong direct (fixed for all groups of indicators), average direct (all except insurance), feedback (placement of funds by individuals; loans/loans of individuals) and weak communication (accounts of individuals; placement of funds by individuals; loans/loans of individuals). The presence of higher education shows a noticeable connection with the consumption by households and individuals of such services as: remote service and non-cash payments, exchange investments, deposits in banks, insurance protection. The level of involvement in interaction with the banking system, loans and overdue debts in non-bank financial organizations are at a comparable level in all federal districts. The higher the level of education, the lower the interest in such services as: placement of funds in micro-credit organizations and credit consumer cooperatives, loans that are small in volume and time taken in credit consumer cooperatives without the use of remote technologies. The assumption that higher education helps residents of Russia to make long-term decisions, avoid mistakes and follow models of responsible financial behavior has been empirically confirmed.

Demand for Financial Services and its Determinants: Micro Empirical Evidences from West Bengal, India

The strength of the economy of a country is closely connected to the soundness and effectiveness of its financial system, in general, and the banking system, in particular. In the Indian scenario, the banking sector plays a great role in the inclusion of groups of people in the formal banking system. Financial inclusion is focused on providing financial services to all sections of the society at a reasonable cost. The traditional measures of financial inclusion are focused on the supply dimension of financial services, but not the demand perspective. After the implementation of financial inclusion drives like the Pradhan Mantri Jan Dhan Yojana (PMJDY), the demand side of financial inclusion gains new importance. This article attempts to recognize some of the demand-based parameters of the financial services after implementation of the PMJDY. The study is based on a primary survey conducted in some selected villages from the Bankura district of West Bengal, where the banking network is not adequate. Besides, the study also evaluates the effects of some socioeconomic factors of the demand of financial services. The empirical evidences show that the asset composition of the household and the income level of the family are effective in determining the demand for financial services.

Financial development, economic growth, and income inequality: a Toda-Yamamoto panel causality test

This paper examines the causality between financial development, economic growth, and income inequality using panel data for 23 European Union countries over the period 1987-2017. The empirical study employs a trivariate setting of Granger non-causality test of heterogeneous panels adopting the Toda and Yamamoto approach using several proxies of financial development capturing different dimensions of the banking system and stock markets. The findings suggest mixed evidence for the causality direction between financial development and economic growth and financial development and income inequality. In addition, the results support bidirectional causality between economic growth and inequality and one-way causality from inequality to growth. The policymakers can focus primarily on economic growth to raise the demand for financial services and encourage income distribution.

Interaction between Islamic Financial Development and Economic Growth: Empirical Evidence from Indonesia

Financial development and economic growth have been thoroughly analyzed in the literature extensively. The discussion revolved on whether the financial sector leads the real sector in the process of economic development or whether it is the other way around. There is now no consensus on the causal relationship between financial development and economic growth. So, it is necessary to determine the relationship between financial development and economic growth in order to make accurate economic growth estimations. This paper examines an interaction model between Islamic financial development and economic growth that assumes the consumption of real resources by the financial sector. This research used Hadri Lagrange-Multiplier to investigate association’s path between variables. As a result, the interaction between Islamic financial development and economic growth may be unidirectional. However, the Islamic financial system is unsustainable, the Islamic financial market's contribution remains modest, and this could not eventually contribute to economic growth significantly. In addition, the results of this study reveal that the development of Islamic financial institutions in Indonesia has not yet had a significant effect on the welfare of Indonesian society. Due to rising demand for financial services, it was believed that economic growth drives finance in developing nations. Moreover, Economic growth fosters competition among financial intermediaries, resulting in more efficient financial transactions and, consequently, increased growth.

Role of institutions in promoting finance in emerging markets: A panel data analysis.

Differences in institutions have garnered much attention in recent years as one of the primary reasons for long-term economic performance, and a vast corpus of theoretical and empirical research demonstrates that financial development can have a substantial impact on economic and financial performance. In fast-growing emerging markets, the demand for financial services has considerably increased, which amplified the need for an efficient regulatory framework to deal with the sensitive nature of financial activities. Surprisingly, the existing literature on the impact of institutions and finance is focused on developed economies, while emerging markets are rarely focused on. Since emerging markets are becoming increasingly important as a result of the swift evolution of institutional and financial transformation, it is crucial to examine how the growth of financial markets reacts to institutional quality. This study investigates the role of institutions in promoting finance in emerging economies using the balanced panel dataset of 21 emerging market. Given the endogenous relationship between institutions and finance, the paper applies a two-stage least squares estimator to test the settler mortality hypothesis in this context. Aligned with theoretical intuition, the empirical result shows that settler mortality is a relevant instrument to institutions. Furthermore, the study performs robustness, using framework that deals with heterogeneity, and cross-section dependence. This empirical effort validates La Porta's Law and Finance Hypothesis in the context of emerging markets. The results of the study are found robust across the variety of alternative measures of institutions and finance, and standard error correction specifications. Therefore, the study offers useful insight into policy implications.

Особливості регулювання ліквідності банків в умовах воєнного стану

The purpose of the study is to systematize methodical approaches to managing the liquidity of banks during the period of extreme volatility in the conditions of war, measures of the National Bank of Ukraine in the field of supervision and regulation of the liquidity of individual banks. The stability of the banking system, its liquidity, and the ability to perform basic functions are of utmost importance under martial law. Correct resolution of issues related to the regulation of banks’ liquidity for the formation of sustainable sources of funding is the basis for expanding lending, which is especially important in the context of significant destruction of the State-owned property, property of enterprises and the population. In the current wartime conditions, Ukrainian banks must maintain adequate liquidity, remain solvent, while lending to customers. The implementation of supervision and regulation in the field of ensuring the bank liquidity is complicated by the matter that the traditional factors influencing it were supplemented by specific factors of war, which caused a sharp drop in economic activity and GDP, withdrawal of funds from accounts, panic about the national currency exchange rate, a significant decrease in demand for financial services, interruptions in the operation of payment systems during blackouts, changes in financial monitoring resulting in a significant expansion of sanctions lists and termination of servicing residents of the aggressor country. Therefore, Ukrainian banks need to use anti-crisis liquidity management instruments (taking into account the regulatory field), which are adaptive in nature and take into account the totality of external factors influencing a viable banking business model under martial law. Further research on the factors influencing the bank’s liquidity, systematization of elements of the process of supervision and regulation of the bank’s liquidity, methods and relevant instrumentarium under martial law remain extremely important.

The Impact of urbanization on banking development: Evidence from the West African Economic and Monetary Union (WAEMU)

The paper aims to investigate the extent to which urbanization and industrialization affect bank development in the WAEMU (West African Economic and Monetary Union). To meet the goal of this study, we used the Pooled Mean Group (PMG) estimator, which requires long run coefficients to be similar but allows short run coefficients and error variances to fluctuate among groups. The sample of the study is composed of 7 countries, with Guinea-Bissau excluded, due to the absence of data on the period from 1980-2016. The results revealed that urbanization has a positive effect on banking development in the WAEMU. This intuitive relationship is linked to the fact that, as the urban population grows, the relative demand for financial services also grows. Also, industrialization has a good impact on banking development. In terms of policy implications, the study calls on governments to create the necessary conditions for successful urbanization to benefit the development of banks in the WAEMU zone.

Linkages between Stock Market Development, Banks and Economic Growth in India: An ARDL Approach

The banking and stock market development was perceived to be an essential channel for economic growth through mobilisation and allocating productive investments. On the other hand, it was emphasised that economic growth would create demand for financial services and would lead to financial sector development. Existing literature attempts to investigate whether financial development is the primary driver of economic growth or vice versa. However, the issue remains unsolved and ambiguous. The present study investigated the causal relationship between stock markets, banks and economic growth in India using Autoregressive Distributed Lag (ARDL) bounds testing approach. The empirical result confirmed the long-run bidirectional relationship between financial development and economic growth in India. In the short-run, the empirical evidence showed that the market capitalisation of the Bombay Stock Exchange and IIP were unrelated and that a bidirectional relationship existed between the value of shares traded on the Bombay Stock Exchange and output. Furthermore, the findings supported unidirectional causality from the National Stock Exchange market capitalisation to output in the short-run. The value of shares traded on the National Stock Exchange and output had a feedback connection.

Explorations Into Loans Granted To Microfinance Institutions By Financial Entities: Observations From The Indian Context

The research paper seeks to analyze the patterns of loans disbursed to Microfinance Institutions (MFIs) by various financial entities over the past 15 years. To achieve this objective, the study utilizes secondary data from NABARD and establishes a comparative framework for the growth rate and percentage distribution of loans extended to MFIs by different commercial and public banks as well as financial institutions. The study's findings indicate that over the last 15 years, commercial banks have been the predominant contributors, accounting for 50 percent of the loans disbursed to MFIs. Additionally, the growth rate of loans disbursed by commercial banks has been the highest at 26.58 percent. However, the analysis in the study uncovers that the onset of COVID-19 led to a decrease in loan disbursements, followed by a subsequent increase in the post-pandemic period. This shift is attributed to the heightened demand for financial services from businesses and households that experienced economic setbacks during the pandemic

Access to Finance: Determinants and Limitations to the Demand Side of Finance for Liberia’s Rural Market

This study reviews the theoretical literature regarding determinants and the limitations to the demand side of rural finance in Liberia with the coming into effect of the National Financial Inclusion Strategy (NFIS). The outcome of this study reveals that education, income level, household assets, and agriculture rank as the outstanding drivers of the demand for finance in Liberia’s rural market. Obviously, the demand for financial services in the rural market of Liberia is very high. However, the demand is limited by a litany of factors such as slow economic growth & lack of job opportunities, poor public infrastructure, structural unemployment, few diversification opportunities, seasonality in agriculture, imperfect information & supervision, and poor social protection and market failures. The keywords used by the author in this article encompass creditworthiness, information asymmetry, financial inclusion, Pareto efficiency, poverty alleviation, and rural finance. Keywords: Credit worthiness, Financial inclusion, Information asymmetry, Pareto efficiency, Poverty alleviation, Rural finance.

Can FinTech reduce disparities in access to finance? Evidence from the Paycheck Protection Program

New technology promises to expand the supply of financial services to small businesses poorly served by banks. Does it succeed? We study the response of FinTech to financial services demand created by the introduction of the Paycheck Protection Program. FinTech is disproportionately used in ZIP codes with fewer bank branches, lower incomes, and more minority households, and in industries with fewer banking relationships. It is also greater in counties where the economic effects of the COVID-19 pandemic were more severe. Substitution between FinTech and banks is economically small, implying that FinTech mostly expands, rather than redistributes, the supply of financial services.

What Drives Mobile Banking Adoption? – An Empirical Investigation Using Transaction Data

Abstract This paper examines drivers of mobile banking adoption by analyzing large-scale transaction data of retail banking clients. We find that the overall demand for financial services is associated with faster mobile banking adoption. Moreover, customers who already use online banking services and show digital skills in their payment behavior, tend to adopt mobile banking faster. Also, adoption rates are higher among the young. Finally, the well-documented gender gap in mobile banking adoption appears to have vanished in recent years: towards the end of our period under review, men and women adopt mobile banking equally. Our results contribute to the literature by addressing novel research questions regarding the fastest growing banking channel. Moreover, our findings carry important managerial implications as they help bank managers in the customer segmentation process and the promotion of mobile banking services.

Formation Trends of Demand for Financial Services

Formation Trends of Demand for Financial Services

Demand for Financial Service in Capital Market of Nepal

Background: In the contemporary literature, access to finance is well spell-out as the key to development. The supply leading hypothesis asserts that financial deepening contributes to enhancing growth so, the growth of the financial market is regarded as an important infrastructure to influence saving and investment. The Government of Nepal opted for a policy ‘One person one bank account’ in its fiscal policy in 2018/19 (MOF, 2018). Aligning the policy, the Securities Board of Nepal (SEBON) launched the ‘one Nepali one D-mat account’ policy in 2018 to increase the access of the capital market throughout the country. The low-financial literacy base is a major constraint to develop the market, in the other, most of the rural population, still are not equipped with the capital market instrument. In, this background, there is an utmost need to examine the factors contributing the demand for the financial services. Objective: The primary objective of the study is to access the determinants of the demand for financial services in the capital market of Nepal, considering the supply leading hypothesis. Method: To examine the determinants of the demand for financial service, we employed the Ordinary Least Square method of regression analysis. The dependent variable employed in this study is the demand for financial services. Level of income, access to finance and financially active provinces have been taken as the independent variable along with the concerned district population. As well, the financial literacy program conducted by the capital market regulator is another major independent variable. Result: The demand following hypotheses asserts that financial literacy is the key to influence the demand for financial services. It is found that financial literacy programs conducted by the capital market regulator could not explain the demand for financial services in Nepal indicating the weak performance of the program conducted by SEBON. It is found that the number of BFIs, population and financially active provinces are highly significant with the demand for financial services indication the influential role of supply leading hypothesis. Conclusion: The study concludes that the variables selected to determine the demand for financial services in capital market are appropriate and most of them (population, per capita income, financially active provinces and access to financial services) are significant with the capital market of Nepal. It is observed that the financial literacy programs conducted by the capital market regulator have not contributed in enhancing demand of the financial services in the capital market of Nepal. Recommendation: The study is focused and based on the capital market of Nepal. Results obtained from this study could not replicate the same in the money market or insurance sector of Nepal. The findings of the study strongly recommend the regulatory body to evaluate and revise its financial literacy programs while in the meantime urge to focus on addressing demand-side inefficiencies in the long run. Originality: The research work is original and has not been published in other publications. As well, no financial support has been received for the study.