How Do Banks Invest in Fintech? Empirical Evidences Around the World

Posted: 25 Oct 2019

See all articles by Luca Bellardini

Luca Bellardini

University of Rome Tor Vergata, Department of Management and Law

Belinda Laura Del Gaudio

University Parthenope of Naples

Daniele Previtali

University of Naples Parthenope - Department of Management Studies and Quantitative Methods; LUISS Guido Carli University

Vincenzo Verdoliva

University of Oklahoma

Date Written: October 9, 2019

Abstract

This paper investigates how banks react to digital transformation outsourcing innovative activities. We provide evidence on the drivers of investment in FinTech firms (FCTs) made up by banks especially in terms of deal and investors characteristics. We also asses the grade of the investment discriminating for equity stake or acquisition. Using a unique sample of 1,198 rounds of worldwide investment in FTCs in which banks participated between 2008 and 2018, we find that the FTCs attract increasing amount when investor is a listed foreign located investment bank and it depend on previous amount already financed. The strategy of bank seems to be to invest in FTC which provide financial services, but this is no longer true in Emerging Market suggesting that bank seeks to cooperate investing in complementary activities.

Keywords: Fintech, Banks, Digital Transformation, Outsourcing, Investment

JEL Classification: G21, G30, O31

Suggested Citation

Bellardini, Luca and Del Gaudio, Belinda Laura and Previtali, Daniele and Verdoliva, Vincenzo, How Do Banks Invest in Fintech? Empirical Evidences Around the World (October 9, 2019). Available at SSRN: https://ssrn.com/abstract=3467024

Luca Bellardini

University of Rome Tor Vergata, Department of Management and Law ( email )

Rome
Italy

Belinda Laura Del Gaudio

University Parthenope of Naples ( email )

via generale Parisi 13
via Acton 38
naples, Naples 80133
Italy

Daniele Previtali (Contact Author)

University of Naples Parthenope - Department of Management Studies and Quantitative Methods ( email )

Via Generale Parisi, 13
Naples
Italy

LUISS Guido Carli University ( email )

Viale Romania 32
Rome, Roma 00197
Italy

Vincenzo Verdoliva

University of Oklahoma ( email )

Via Generale Parisi, 13, 80132, Napoli
80132
Italy

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