Financial Technologies and Economic Resilience from COVID-19

Abstract

We examine the relation between financial technologies (Fintech) and countries’ economic resilience from COVID-19 around the world. Measuring the demand for Fintech services using Google search volumes of high-frequent Fintech-related phrases, we document that developing countries and those with underdeveloped Fintech industry exhibit more significant Fintech demand surges during the pandemic. Moreover, stronger Fintech is positively associated with GDP growth and negatively related to unemployment rates. We develop a comprehensive economic resilience measure to capture both the speed and strength of economic resistance and recovery in response to the pandemic shock. Our analysis reveals that Fintech can serve as an essential enabler and accelerator of economic growth, contributing to economic stability and resilience from the global health crisis.

Keywords: Fintech, COVID-19 Pandemic, Economic Growth, Unemployment Rate, Google Search Volume