Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/234596
Authors: 
Hasan, Iftekhar
Kwak, Boreum
Li, Xiang
Year of Publication: 
2021
Series/Report no.: 
IWH Discussion Papers No. 26/2020
Abstract: 
This study investigates whether and how financial technologies (FinTech) influence the effectiveness of monetary policy transmission. We use an interacted panel vector autoregression model to explore how the effects of monetary policy shocks change with regional-level FinTech adoption. Results indicate that FinTech adoption generally mitigates monetary policy transmission to real GDP, consumer prices, bank loans, and housing prices. A subcategorical analysis shows that the muted transmission is the most pronounced in the adoption of FinTech payment and credit, compared to that of insurance. The regulatory arbitrage and competition between FinTech and banks are the possible mechanisms leading a mitigated monetary policy transmission.
Subjects: 
monetary policy
financial technology
interacted panel VAR
JEL: 
C32
E52
G21
G23
Document Type: 
Working Paper

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