Research on impact of financial technologies on commercial banks profitability ratios

Abstract

The aim of this study is to evaluate impact of financial technologies on commercial banks profitability. The research analyzes scientific literature, distinguishes the research methods used, and performs linear regression analysis to evaluate the impact. The research analyzes financial technologies used by commercial banks operating in Lithuania (payment cards, ATMs, EFTPOS, electronic banking) and return on assets (ROA) and return on equity (ROE) ratios. The study rejects the hypotheses that financial technologies have an impact on commercial banks “profitability ratios, as the results of the research did not show significant impact of financial technologies on commercial banks” profitability ratios. The results of the study may alert commercial banks to the return on investment of financial technology. However, it is important to note the limitations as the results of this study are based only on commercial banks operating in Lithuania and the small sample size may lead to inaccurate results.