Association between Global Financial competitiveness and FinTech Consumer experience; FinTech Ecosystem; FinTech Firms

Abstract

This paper investigates the association between international financial competitiveness and three important FinTech aspects: FinTech Consumer experience, FinTech Ecosystem, and FinTech firms in Asia, Western and American cities. FinTech Consumer experiences represent the demand side, FinTech firms represent the supply side, and FinTech Ecosystem represents the government policy. Improvement in the three FinTech aspects is expected to enhance FinTech development and improve international financial competitiveness. Indicators for the three FinTech aspects are extracted from the Global FinTech Hub report 2020; the proxy for the financial competitiveness comes from the Global Financial Centres Index 28 on Sep 2020. Data from 34 cities across 20 countries globally are analyzed using maximum likelihood estimation with Newton-Raphson/Marquardt steps with the assumption of Poisson distribution as the data generation process. It is usually believed that there is a high positive association between international financial competitiveness and the three FinTech aspects. However, the empirical result in this paper shows that only the FinTech ecosystem is essential in enhancing global financial competitiveness. The effects of FinTech Consumer experience and FinTech industry in enhancing global financial competitiveness are insignificant in Western and America and are negatively significant in Asia.