Open AccessFinancial Technology Disruption in Indonesian Banking: From Loan and Interest Rate Perspectives
Author(s) -
Daniel D. Rumani Hizkia H. D. Tasik
Publication year - 2021
Publication title -
psychology
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.112
H-Index - 10
ISSN - 0033-3077
DOI - 10.17762/pae.v58i1.750
Subject(s) - loan , interest rate , banking industry , financial system , business , panel data , fintech , economics , finance , financial services , econometrics
The presence of Fintech has contributed to the changes in many industries in Indonesia. Among others, banking industry has been one of the most resilient to alterations and skeptical to disruption by Fintech. Using the data of banking industry covering national banks, regional banks, national private banks and foreign banks, from 2009 to 2019, this study aims to examine the impact of interest rate in pre-Fintech period compared to the impact in post-Fintech period. This study sets 2016 as the time threshold. Using panel data regression model, the findings suggest that the power of interest rate in changing the level of loans is lower in the post-Fintech than in the pre-Fintech.Additionally, in many cases, the power is even statistically insignificant in the post-Fintech. Reforms in banking loan regulation is necessary to respond to the presence of Fintech.