Global Financial Institutions Research Articles

How does cybersecurity awareness help in achieving digital financial inclusion in rural India under escalating cyber fraud scenario?

ABSTRACT The remarkable rise of cybercrime and its catastrophic consequences pose a significant threat to global financial and banking institutions. Financial inclusion is essential in fostering economic development and enhancing individual empowerment. Integrating digital technologies in the banking sector, promotes digital financial inclusion. However, the increasing prevalence of cybercrimes poses a significant threat towards digital financial inclusion. Considering the rising cases of cybercrimes, the research model integrates the constructs of UTAUT and DOI theory, along with two additional constructs, viz. cyber fraud and cyber security awareness, in the context of digital financial inclusion through payment banking in rural India. By examining the effect of cybercrimes on trust and adoption intention, the study provides valuable insights into the implications of digital financial inclusion. The findings revealed that cyber fraud harms trust and payment banking adoption. Cyber security awareness, facilitating conditions, and trust positively affect payment banking adoption, ultimately enhancing digital financial inclusiveness in rural India. The structural model suggests that emerging cyber fraud has become a significant challenge to digital financial inclusion. In contrast, cyber security awareness among payment banking users could be helpful for rural digital banking users to protect their bank accounts from cyber fraud.

Financial innovation intra Muslim capital markets and inter global counterparts: implications of differences

Purpose This study aims to investigate the implications for financial innovation and product development of differences between schools of jurisprudence (fiqh) pertaining across regional Muslim markets, and the consequences for global financial institutions. Design/methodology/approach The methodology is qualitative, drawing upon several sources. Firstly, differences in interpretation regarding the economic and moral responsibilities of financial institutions in Islamic and secular contexts. Secondly, contrasting tenets of schools of Islamic jurisprudence regarding the permissibility of products traded intra Muslim markets. Thirdly, characteristics of complex financial instruments traded in global secular markets prior to the credit crisis of 2007–2008. Findings Differences between Islamic and global secular interpretations regarding responsibilities of financial institutions militate against integrated markets across which products can be seamlessly traded. Global financial institutions should recognise that different Islamic schools of jurisprudence prioritise either legal form or substance of financial products, but not both simultaneously. This should be considered when designing new products for regional Muslim markets. Practical implications Global financial institutions which focus upon the legal (micro) form of new Islamic products should relate in investor prospectuses and marketing materials the extent to which these accommodate Islamic jurisprudence’s equal (macro) concern for public interest or maslahah. This may comprise the reallocation of risk from those unable to bear it to those willing to assume it for a price, reinforcing rather than compromising economic stability. Originality/value This study evaluates implications for product development and marketing for global financial institutions active in regional Muslim markets across which different Islamic schools of jurisprudence apply.

The United Nations Sustainable Development Goals and global finance: Recent evidence

AbstractThis article provides a review of different global financial institutions and how they are making progress towards the United Nations Sustainable Development Goals (UN SDGs) through examination of their mission statements, stated purposes, financial products & services, and sustainable development projects. Through archival research, this study conducts an empirical investigation of how financial institutions are making progress on global environmental, social, and governance (ESG) issues. For each type of international financial institution, this study presents a prominent sample entity, evidence of value creation for the common good, and relationship to specific UN SDGs. This study provides evidence of different global institutions financing sustainability projects that create value for the common good with long‐term impact horizons. The evidence suggests that the combination of social factors and environmental factors outweigh the financial factors in the realized projects. This study proposes a novel approach towards comparing financial institutions in creating value for the common good based on the sustainable finance framework of Schoenmaker (2017, Investing for the common good: A sustainable finance framework. Bruegel).

Monetary Smurfing Analytics Model using ML

The act of taking money obtained from illegal operations, such as drug trafficking, and disguising it as profits from a legitimate business venture is known as money laundering. The money obtained through illegal action is regarded as dirty, and to make it appear clean, it is "laundered." Money laundering is a major concern to the country these days, as well as financial institutions. The sophistication of this illegal activity is growing; it appears to have beyond the tired old trope of drug trafficking to include financing terrorism and, of course, personal benefit. Research on anti-money laundering is crucial since money laundering is a global issue that seriously jeopardizes international security and financial stability. Furthermore, it's estimated that the banking system seizes only 0.2% of the money that has been laundered. The crime itself is growing more sophisticated and intricate, and banks are becoming more vulnerable as a result of its ongoing volume amplification. Considering the role that banking institutions play in the money-laundering industry, practitioners and researchers are becoming more interested in creative ways to solve problems and enhance anti-money-laundering efforts. Researchers are starting to look into the viability of artificial intelligence methods in this setting. A systematic knowledge deficit concerning a thorough study that meticulously examines and combines artificial intelligence methods for countering money laundering in the banking industry was discovered, though. To combat investment fraud, the majority of global financial institutions have been putting anti-money laundering measures into place. Data mining tools have emerged recently and are thought to be effective methods for identifying instances of money laundering.

Causality Analysis between ESG Performance and Financing Support

Recent global trends in electric vehicles (EV) triggered Indonesia to participate in battery industry development. Rich in geological resources, the government promotes various capital-intensive industries that process raw mining commodities, particularly limonite nickel ore, to support the EV industry in Indonesia. Inarguably, financial support is needed from various financial institutions and investors. On the contrary, the mining industry is closely related to environmental issues that attract the attention of financial institutions and investors. Therefore, understanding the relationship between “sustainability” and “financing activity” is essential, as it may not only practically guide the business to re-examine their environmental, social, and governance (ESG) initiatives but also extend the literature review on these matters. Therefore, this paper aims to describe the system through the Causal Loop Diagram (CLD) formed by ESG factors related to the financing process in mining companies in Indonesia. The research method used in this paper is developing causal loop diagrams from primary data and literature reviews. The CLD is constructed through a literature review and confirmed by an expert from the mining company. The result explains the causal loop between sustainability and financing. Improving ESG performance will increase financial support from global investors and financial institutions. To support practice and concept sustainability in Indonesia, the government should encourage mining companies to increase local partnerships and CSR Allocation as it will support the company's financing activity and trigger community improvement. Creating a supporting environment to attract global investors to finance the mining company in Indonesia is also necessary. Keywords: Causal Loop Diagram, ESG Performance, Financial Performance, Mining Industry, Sustainability JEL : M14, Q01, G32

A literature review on the design and implementation of central bank digital currencies

Within the last five years, research on Central Bank Digital Currencies (CBDCs) has increased with increased momentum. Particular events, such as the growth of private digital currencies, Facebook’s attempt to release a stablecoin, the long-term development of Chinese CBDC, and Covid-19, are the leading causes for this growing significant interest. Most recently, the interest converged in more specific design and implementation directions. Many scholars show particular interest in account-based retail CBDCs with interest-bearing capabilities. In contrast, few others urge caution by favoring a wholesale model that is representative of the setting of the current financial system. Unsurprisingly, the primary source of such literature stems from global financial institutions and their close central banking networks. Academia and research institutions have recently increased their focus on the potential economic and social impacts of such purported design choices. As specific design principles for CBDCs have started to take shape, the policy objectives of implementing different CBDC designs are studied from the perspective of benefits and risks. These trade-offs are either generic or related to macroeconomic and financial stability implications. Evidence exists that purported generic benefits can often be achieved without CBDCs, while the purported monetary and fiscal policy benefits rely on theoretical results that lack real-world data. Some of the risks could be amplified depending on CBDC design choices. Theoretical and alternative literature is reviewed along with the evidence from use-case applications to spot the possible shortcomings in the current stage of the design and implementation literature of CBDCs. The scope is limited to the impact on economic policies and the relevant potential socioeconomic impact. The results show that further research and debate are needed from a multidisciplinary perspective.

A Study Literature of Interest Rates and Islamic Monetary Policy

This paper provides a comprehensive analysis of the existing literature about contemporary Islamic monetary policy and its implementation through interest rates in the context of monetary policy. Upon conducting a comprehensive examination of the pertinent literature, it becomes evident that numerous conventional monetary policy instruments can be suitably modified and employed within the framework of Islamic monetary policy. Using interest rates as a monetary policy tool has been observed to directly impact injustice, including social unfairness, widespread corruption, and manipulation by global financial institutions that governments and authorities support. The current global financial crisis exemplified this. This study aims to analyze the several alternatives to interest rates utilized in Islamic monetary policy tools while also conducting a literature analysis on Islamic monetary policy.

How macroprudential regulation and board effectiveness interact to shape bank risk-taking behavior

This study aims to investigate how macroprudential policies and corporate governance interact to curb bank risk-taking behavior for a sample of 915 publicly listed commercial banks in 53 countries over the 2011–2020 period. Excessive risk-taking by global financial institutions was singled out during the global financial crisis of 2007–2009. We first use a fixed-effects OLS panel model. Then, to address endogeneity concerns, we apply a two-step system GMM estimation. Our results show that the impact of board attributes on risk-taking depends critically on MPP’s policies. We find that MPPs can enhance the supervisory power of a board characterized by high independence, and a CEO who performs a dual function. However, a large board size appears to increase bank risk when multiple macroprudential policies are in place, which can result in managerial policies that may increase bank risk-taking. The supervisory role of women on the board is only effective in the presence of tight macroprudential policies. Bank regulators should consider the interaction between corporate governance and macroprudential policies when designing more effective bank regulations.

The camp as market frontier: Refugees and the spatial imaginaries of capitalist prospecting in Kenya

This article critically interrogates the ambitions of humanitarians, policymakers, and their corporate partners to fundamentally remake both camp economies and the refugees who inhabit them. It draws on a unique set of elite interviews with key actors from a network of organisations driving ‘innovative’ humanitarian projects in the Kakuma camp and Kalobeyei settlement in Kenya. We identify their shared spatial imaginaries which, first, reconfigure camps from spaces of dependency to capitalist frontiers of the market and, second, produce a normative construction of refugee personhood that corresponds to this space. We show that the camp as market frontier is imagined as an enabling environment that both redeems and creates the otherwise ‘subdued’ humanity of refugees through allowing their flourishing as rational capitalist subjects. Against popular depictions of refugees as ‘burdens’, we find that our interlocutors present camp refugees as entrepreneurial capitalists-in-the-making who are only inhibited by their own lack of training, humanitarian welfarism, and the deficiency of a proto-capitalist environment. And yet this latent surplus population is thought to live alongside camp paupers whose value cannot easily be made legible within market logics geared towards 'productivity'. The stratification of camp inhabitants in this way signals the (re)production of an authorised version of refugee 'being' that resonates with the objectives of exclusionary marketisation agendas. While the optimism expressed in imaginaries of economic potential and thriving may appear seductive, in that these spatial stories promise to restore the ‘dignity’ of refugees, we argue that they ultimately enable less virtuous economic practices and conceal the complicity of global corporations and financial institutions in perpetuating the exploitative operations of capital.

Role of Treasury Single Account in Enhancing Transparency, Good Governance and Curbing Corrupt Practices in the Nigerian Public Service

The Treasury Single Account (TSA) was introduced by the global international financial institutions specifically the World and IMF to help countries block leakages and other wastages that are associated with corrupt practices in the management of the public funds by the public servants. The TSA was embraced by the Nigerian Government with the same objective of blocking leakages and fostering transparency in public services. This has been behind the background of the allegations of corrupt practices, mismanagement, leakages, waste and squandering of public resources by the public servants who dubiously maintained several accounts for one ministry or agency. This study investigated the role played by TSA in the promotion of transparency, good governance, and preventing corrupt practices. The study used documented sources for assembling data involving the existing body of literature after thoroughly identifying the clear gap for contribution to knowledge. The sources obtained were discussed using empiricism where statistical data were analysed on the impact of TSA on preventing leakages and corrupt practices. The study discovered that the introduction of TSA in the Nigerian public service was a good reform and a success in minimising dubious transactions, corrupt practices, and the operation of suspicious redundant accounts by Ministries, Departments, and Agencies (MDAs) of Government. The study therefore, recommends that there is a need for full automation and digitalisation of governmental processes in Nigeria to reflect in other sectors of governance which can help in preventing leakages, malpractices, corrupt practices, and misgovernance.

Reformatting the Russian monetary system in modern conditions

The article considers the question of possible ways of transformation of the Russian monetary system in modern conditions. Currently, Russia is facing tough economic and political sanctions, which encourage it to introduce fundamental structural reforms in all areas of the economy. The situation in which our country finds itself requires an adequate response in order to preserve economic sovereignty. It is required to restructure the monetary system in such a way that the economy is focused on using mainly its own resources. Modern theories of money could be the theoretical foundation for the upcoming transformations. The study concentrates on the Modern monetary Theory (MMT) and its possible implementation in the Russian economy. The interest that has arisen in this non-orthodox theory is due to many reasons, but the main one is that the monetary institutions of the leading countries of the world can no longer implement the previous monetary policy in order to stimulate economic growth. Scientists evaluate this theory ambiguously, and many researchers believe that its main provisions are divorced from economic realities, contradictory and, therefore, not acceptable as instruments of macroeconomic policy. The author's stance is that the main provisions are applicable in the Russian economy. Mainly, the idea of the sovereignty of the national currency is understood as the possibility of issuing money without regard to global financial institutions such as the IMF and the size of gold and foreign exchange reserves. As a result, this theory requires a deeper study of the influence of monetary emission on economic processes.

Global financial ecosystem and processes of unshadowing of business activities: the role of the FATF

Purpose. The purpose of the article is to reveal the specifics of the activities of global financial institutions as legal entities under international public law, important components of the global financial architecture and agents of unshadowing of the world economy using the sample of the Financial Action Task Force (FATF). The postulate of the work defines the leading importance of the institutional mechanism of unshadowing of the global economy for the development and implementation by countries of the unshadowing toolkit in a combination of economic and legal components as a factor of sustainable development.
 Results. It was found that the continued expansion of the shadow segment of the global economy actualizes the expediency of researching patterns and features of the processes that cause and accompany it. The global financial architecture is undergoing transformations adapting to the challenges of the shadowing of the world economy, including 1) the implementation of shadow economic transactions by business entities, 2) the deformation of the competitive environment and capitalist market institutions, 3) the distortion of business activity models, 4) the degradation of people's economic behaviour, as consumers and employees, and 5) aggravation of the global environmental problem. The classification of subjects of the unshadowing of the world financial sphere, which play a key role in its architecture, including their division by types 1) international universal organizations, 2) international financial organizations and 3) international specialized institutions, has been carried out. The structure-forming role of normative documents, which determine both the goal-setting and general quantitative characteristics of the environment of financial institutions, as well as the peculiarities of the development and implementation of activities for the unshadowing of economic relations and systems, has been revealed. All countries are only on the way towards effective economic models and sound global financial ecosystem.
 Scientific novelty. A new model of the institutional matrix of the global financial ecosystem is proposed, including the green economy and sustainable development components. The peculiarities of FATF in the global financial architecture and processes of unshadowing of business activities are revealed.
 Practical value. The obtained results can be used in the improvement of the national policy of countering the shadowing of business activities, reducing the environmental problem, as well as increasing the effectiveness of international economic relations in this area.

Review: Revolution in Development: Mexico and the Governance of the Global Economy, by Christy Thornton

Review: <i>Revolution in Development: Mexico and the Governance of the Global Economy</i>, by Christy Thornton

Policing third-world countries through a system of lending: The socioeconomic and political implications for Nigeria

One common economic phenomenon of third-world countries is the high tendency not to be able to financially sustain themselves. According to the Central Intelligence Agency (2022), a plethora of these countries like Nigeria, Ghana, Togo, Congo, Sierra Leone, and Equatorial Guinea, among others, tend to continually borrow funds from countries with developed economies and other global financial institutions. In other words, many African countries continue to depend on the Western powers for survival (Mhango, 2017). This has been a growing trend since many of the developing countries attained the status of political independence some four to six decades ago. There are realities around the core inability of the governments of developing countries to finance many state-owned projects, including recurrent expenditures. Since the genesis of Nigeria’s public debt in the late 1970s and early 1980s, the country has been through economic hardship with poverty and stagnation to show for the humongous loans taken year-in, year-out. Oftentimes, going by the Western powers’ analysis, fingers have been pointed at the country’s corrupt leadership, while feasible lessons from the soil have indicated colonialism, neo-colonialism, and imperialism of Western domination. Isiani et al. (2021) maintained that the most pressing position has been Nigeria’s economic linkage with the International Monetary Fund (IMF) and other instrumentalities of external loans that have over the years enmeshed the country in deeper debts through their imposed conditionality, and in addition submitted the example that the Structural Adjustment Program of IMF loans in the 1990s cemented Nigeria’s economic doom until today.

The Role of the International Monetary Fund in the Post-War Reconstruction of Bosnia and Herzegovina

The specifics of international organizations stated in the paper contain a particular reference to global financial institutions. It refers to the support of the development of countries in transition. It also states their reconstruction under the patronage of subjects of international law. The authors indicate the importance of the foundation and historical development of international financial institutions, especially the International Monetary Fund, along with its connection with its growing influence in the field of project financing, both regionally and globally. In the second part of the paper, the focus is on the participation of the International Monetary Fund in the reconstruction and revitalization of Bosnia and Herzegovina from the end of the war conflicts in 1995 until today. The comparative review points to the most significant areas that had the support of the International Monetary Fund in the financing of projects but also draws attention to the political side of this support through the imposition of conditions for financial resources to be approved. Through an overview of stand-by arrangements, the authors analyze the connection between the approval of projects by international financial organizations and their relation with the insistence on the implementation of specific reforms in Bosnia and Herzegovina

КОНЦЕПТУАЛЬНІ ПОЛОЖЕННЯ ВИКОРИСТАННЯ REGTECH-ТЕХНОЛОГІЙ У РЕГУЛЮВАННІ ПРОЦЕСІВ ЦИФРОВІЗАЦІЇ ФІНАНСОВИХ УСТАНОВ

Digitization of the financial services market leads to increased interest of the regulator in the use of innovative digital technologies (cloud computing, blockchain, big data, artificial intelligence, ma-chine learning, etc.) in its activities. RegTech (regulatory technologies) offers significant advantages to organizations in terms of optimizing compliance processes and managing regulatory risks, helps moni-tor and timely take into account changes in current legislation. The main prerequisites for the emergence and development of such technologies are the constant complication of the regulatory field, its high dynamism, as well as the active dissemination of the achievements of scientific and technical progress. The purpose of the article is to analyze the key modern trends in the regulation of the activities of finan-cial institutions in the field of information technology implementation. The conducted research made it possible to single out the following trends: increased attention to data privacy and security; strengthen-ing cybersecurity requirements for financial institutions to protect against data leaks and cyber attacks; development by regulators of a regulatory framework for the regulation of cryptocurrencies and digital assets; research by regulators of ways to manage algorithms of artificial intelligence and machine learn-ing in the work of financial institutions; development by the regulator of recommendations and instruc-tions on the use of cloud computing; introduction of regulatory sandbox regimes in territories for testing new digital financial services in a controlled regulatory environment; ensuring consistent supervision of global financial institutions; deepening of requirements for the protection of consumer rights, etc. The authors come to the conclusion that despite some problems and difficulties in the introduction and use of regulatory technologies, they remain quite relevant and are in high demand on the market. Among the primary tasks facing developers of RegTech solutions, it is worth highlighting the solution to the problems of protecting the confidential data of clients of financial institutions, as well as increasing the transparency of their activities

A sociological analysis: performance of global financial institutions, business ethics, and corporate governance

With the rapid advancement of technology, the 21st century has brought us a dynamic terrain that has given rise to extremely competitive markets. In addition to spurring innovation, technological developments have also resulted in a deterioration of public confidence in the banking industry, which has been made worse by recent high-profile cases of financial misbehavior. Businesses are under increasing pressure to operate well and sustainably for the good of their clients, shareholders, and the company as a whole. These pressures range from environmental concerns to human rights violations. Organizations must outline plans in order to successfully navigate this complicated terrain and address societal needs while ensuring future success. Companies that want to compete successfully in marketplaces with cutting-edge technology must address ethical issues. Businesses must find a careful balance between financial imperatives, environmental sustainability, and respecting human rights within their strategy frameworks in an era marked by widespread corporate disobedience and non-compliance. Public fear has been exacerbated by recently reported banking scandals, which include employee dishonesty such as opening bogus accounts, market manipulation schemes, and deficiencies in compliance processes. These violations, which go unpunished for long stretches of time, highlight how urgent it is that businesses have strong corporate social responsibility policies. According to this study, businesses that actively participate in corporate social responsibility (CSR) have a higher chance of long-term success, highlighting the importance of morality and social responsibility in overcoming the difficulties presented by modern markets.

Development of Innovative Tools in Global Financial Markets

The purpose of the article is to study the theoretical foundations and develop practical recommendations for improving the process of functioning financial instruments in global financial markets. The article reveals the essence and characterizes the components of the modern global financial market, defines its role in the development of the national economy, and the peculiarities of its formation in the conditions of the expansion of innovative digital technologies. The essence of financial market instruments is revealed and the need to improve their investment qualities to the requirements of modern economic conditions is argued. Financial instruments that are in circulation on the financial market are systematized according to several features. Considerable attention is paid in the work to the circulation of innovative financial instruments, the main feature of which is a high level of risk. Peculiarities of the formation and functioning of derivative financial instruments were studied, and the essence and specifics of the use of credit notes on the stock market were revealed. The mechanism of circulation of credit notes is presented and their main functional features are defined. It is noted that the issuance and sale of credit notes enable borrowers to mobilize funds on the global financial markets, and improve their investment image in the international market through the formation of a high credit rating from global financial institutions. The peculiarities of cryptocurrency circulation on the global financial market from the point of view of today's most popular innovative financial instrument are revealed; the authors emphasized the dual nature of cryptocurrencies, as it has the properties inherent in stock market instruments and features that characterize financial pyramids. The dynamics of the development of the global cryptocurrency market over a long period have been analyzed. The peculiarities and problems of regulating the circulation and taxation of cryptocurrencies in Ukraine and the world are highlighted. The formation and specifics of circulation on the domestic financial market of bitcoin derivatives as a new financial instrument are described. The authors also focused attention on the spread of negative trends in the circulation of cryptocurrencies and substantiated possible ways to overcome them. The article analyzes the functioning and development of the option certificates and derivatives market in Ukraine in terms of stock and over-the-counter markets. The main factors restraining their development include inadequate regulatory and legal support, the small size of the markets, and a small number of tools used in them.

Extreme risk connectedness among global major financial institutions: Links to globalization and emerging market fear

Using high frequency data and “realized jumps” to depict extreme risk of stock returns, we propose a novel empirical framework to estimate and visualize the network structure of extreme risk among the global major financial institutions. With this model, we construct a series of indices to describe how the extreme risk connectedness evolves over time at the institution, country and global levels, and study the underlying factors driving the connectedness. Our results show that the degree of globalization, in particular, political globalization plays the most important role in driving a country’s importance in global extreme risk propagation. We also identify the “emerging market fear”, which is evidenced by the increased importance of emerging countries in the global financial extreme risk propagation; the increased proportion of emerging market-based institutions in the systemically important financial institution cohort; and a stronger granular impact of emerging market extreme risk on the global financial market stability. These results have important implications on managing systemic risk of global financial system.

Businesses and NGO's endorse a global plastics treaty

85 organizations, reportedly including major global businesses, financial institutions and NGOs, have announced a common vision for an effective and ambitious “Global Treaty to End Plastic Pollution”.