Political economy of Fintech : empowering the SME in developing countries

• Main Author: Cheng, Leo Ka Lok
• Other Authors: Kaewkamol Pitakdumrongkit
• Format: Theses and Dissertations
• Language: English
• Published: 2019
• Subjects: DRNTU::Social sciences::Economic development
• Online Access: http://hdl.handle.net/10356/77193
• Institution: Nanyang Technological University

Fintech (financial technology) is the use of technology to renew the delivery of financial service. The rapid growth of the fintech industry has drawn people attention to its potential economic value and impact on the regulatory framework. Advances in technology could be a disruptive innovation in the financial industry, which empowers the disadvantaged individuals in our community, such as the SME. Fintech could provide them more accessible financial services to SME loans and hedging. Besides, Fintech seems to have experienced better adoption among the general public in developing countries than in developed countries. Among the top 5 countries in Fintech adoption rate1, developing countries China, India, and Brazil remain top five with developed countries like the UK and Australia. It gives rise to the question of why an advanced technology country will lose in the Fintech competition. This paper aims to find out the reason. In light of Fintech trend, this paper will first access the Fintech economic benefits on SMEs in developing countries. It discovers that two key determinants are contributing to the above statement. 1. Market Inefficiency in the financial markets 2. The different style of state-business relationship would alter the speed of development.