Fintech in the Time of COVID-19: Trust and Technological Adoption During Crises
59 Pages Posted: 29 Apr 2020 Last revised: 28 Dec 2020
Date Written: December 23, 2020
We document the effects of the COVID-19 pandemic on digital finance and fintech adoption and usage. Drawing on mobile application data from 71 countries, we estimate that the spread of COVID-19 and related government lockdowns led to between a 29.2 and 32.8 percent increase in the relative rate of daily downloads during the peak of the pandemic. We analyze factors that may have driven this effect on the demand-side and better understand the “winners” from this digital acceleration on the supply-side. Our overall results suggest that traditional incumbents exhibited particularly large gains relative to “BigTech” companies and newer fintech providers during this crisis period. Finally, we show that businesses that are amalgamated with existing digital payment infrastructure are better able to offset the adverse economic effects of COVID-19.
Keywords: digital finance, fintech, financial inclusion, technological adoption, market structure, COVID-19
JEL Classification: G23, G20, 033, L1
Suggested Citation: Suggested Citation