High-Speed Internet, Financial Technology, and Banking

• 成果类型: Article
• 署名作者: D'Andrea, Angelo; Limodio, Nicola
• 署名单位: European Central Bank; Bank of Italy; Bocconi University; Bocconi University; Bocconi University
• 刊物名称: MANAGEMENT SCIENCE
• ISSN/ISSBN: 0025-1909
• DOI: 10.1287/mnsc.2023.4703
• 发表日期: 2024
• 关键词: FinTech; banking; INVESTMENT; financial development

摘要

Exploiting the staggered arrival of fiber-optic submarine cables, we show that highspeed internet promotes the role of banks and credit in Africa. Variation within country and across multicountry bank networks indicates that high-speed internet induced a 22% expansion in credit supply. We investigate the role of plummeting telecommunication costs in promoting the bank adoption of new financial technologies and study a specific technology used in the interbank market, the real-time gross settlement system (RTGS). We find that upon connecting to high-speed internet, banks adopt the RTGS more extensively, reduce inside liquidity, and increase interbank transactions and lending. We also observe that high-speed internet particularly strengthens firms in countries with weak preexisting interbank markets.