Determinants of Bank Competitiveness in Digital Era

In this digital era, many previously traditional indicators may no longer be the main determinant of firm competitiveness. In banking sector, this premise is prevalent, especially due to the rising of financial technology companies. A recent research conducted by a group of researchers from Bina Nusantara University tries to examine ICT and financial factors as determinants of bank competitiveness in digital era, using South Korea as the case study. IT center operation and IT scandal released in news were chosen to represent ICT factors. Bank competitiveness is represented by the bank’s market share, both in the borrowing and lending markets. The result suggests that despite the importance role of ICT factors in determining bank competitiveness, financial factors are still the dominant ones. This study proposes recommendations to banks to leverage ICT innovation and to policy makers to consider ICT security regulations in the banking market.

Full paper can be accessed here

(YH)