The Effect of the Growth of Financial Technology Companies Peer To Peer Lending on the Performance of Banking in Indonesia

Dyah Nikita Sari

Abstract


The technological developments in the financial world that being discussed are financial technology companies. The companies provide financial services like banking with the use of technology. Financial technology companies consist of various types, one of which is Peer To Peer Lending, which provides loans directly from lenders to borrowers of several types. However, the development of Peer To Peer Lending is considered to threaten banks in Indonesia because they provide the same banking services but more simpler and competitive. This study investigates the relationship between the growth of financial firms and banking performance in Indonesia. Researcher used data from 109 banks registered with the Financial Services Authority (OJK) and financial company data from 2015 to 2019. Researcher found that the growth of financial technology companies was seen from the number of companies, number of lender accounts, number of borrower accounts, number of transactions. the borrower, and the number of transactions of the lender have a negative effect on banking performance as measured by various kinds of profitability ratios. This research has implications for banking management to pay more attention to the growth of financial technology companies that have an influence on banking performance, so that in making future policies it can maintain the balance of developing markets in Indonesia. 


Keywords


Financial Technology, banking performance

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References


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