Financial technology (FinTech) is an emergent industry that combines two traditional industries: finance and technology. FinTech transforms and innovates the finance industry with up-to-date technology to provide efficiency to the capital market and financial service providers. This teaching case will discuss a Hong Kong Fintech start-up, how it formed, and how it raised the first round of venture capital funding to kick-start the company. A business plan and decision analysis are also presented in this case.
{"title":"Fintech in Hong Kong – Blockchain, Business Model, and Challenges","authors":"Yiu Kei Li, N. Harkiolakis","doi":"10.2139/ssrn.3806491","DOIUrl":"https://doi.org/10.2139/ssrn.3806491","url":null,"abstract":"Financial technology (FinTech) is an emergent industry that combines two traditional industries: finance and technology. FinTech transforms and innovates the finance industry with up-to-date technology to provide efficiency to the capital market and financial service providers. This teaching case will discuss a Hong Kong Fintech start-up, how it formed, and how it raised the first round of venture capital funding to kick-start the company. A business plan and decision analysis are also presented in this case.","PeriodicalId":13594,"journal":{"name":"Information Systems & Economics eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2020-03-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"76960066","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Innovation scholars have, in the past, applied the concept of ‘windows of opportunity’ to study latecomer firms’ catch‐up. Previous research treats this concept as three separate aspects, i.e., technological, institutional and market. The role of government was seen as being concerned only with institutional windows of opportunity. However, governments in emerging markets exert influence not only through traditional means of institutional support but, also, via market‐driven mechanisms. The former refers to state procurement, resource provision, legislation, and administrative control, whereas the latter is concerned with demand creation, resource allocation, and the regulation of market orders. This multifaceted nature of government in promoting economic growth, guiding technological development, and influencing enterprise behavior remains under‐researched. Yet, it plays a crucial role in the catch‐up of emerging market enterprises. Therefore, based on innovation studies literature and an institution‐based view of international business, the present research proposes a new construct, termed the institution‐led market, with the aim to encapsulate the complex role of government in the catch‐up of emerging market enterprises. The institution‐led market is defined as a unique type of market that is well‐timed and strategically created by the government and supported by institutional policies and resources. A large database of 259 Chinese firms in 37 industries was created and analyzed using a hierarchical logistic model to empirically test the relationship between the institution‐led market and technological catch‐up of emerging market enterprises. We demonstrate that the institution‐led market positively affects the catch‐up of emerging market enterprises; furthermore, it significantly moderates the effect of technological discontinuity on the catch‐up. Finally, the theoretical contributions and managerial implications of the present research are discussed.
{"title":"The Critical Role of the Institution‐Led Market in the Technological Catch‐Up of Emerging Market Enterprises: Evidence from Chinese Enterprises","authors":"Jiang Wei, Cong Sun, Qing Wang, Qiuyue Pan","doi":"10.1111/radm.12399","DOIUrl":"https://doi.org/10.1111/radm.12399","url":null,"abstract":"Innovation scholars have, in the past, applied the concept of ‘windows of opportunity’ to study latecomer firms’ catch‐up. Previous research treats this concept as three separate aspects, i.e., technological, institutional and market. The role of government was seen as being concerned only with institutional windows of opportunity. However, governments in emerging markets exert influence not only through traditional means of institutional support but, also, via market‐driven mechanisms. The former refers to state procurement, resource provision, legislation, and administrative control, whereas the latter is concerned with demand creation, resource allocation, and the regulation of market orders. This multifaceted nature of government in promoting economic growth, guiding technological development, and influencing enterprise behavior remains under‐researched. Yet, it plays a crucial role in the catch‐up of emerging market enterprises. Therefore, based on innovation studies literature and an institution‐based view of international business, the present research proposes a new construct, termed the institution‐led market, with the aim to encapsulate the complex role of government in the catch‐up of emerging market enterprises. The institution‐led market is defined as a unique type of market that is well‐timed and strategically created by the government and supported by institutional policies and resources. A large database of 259 Chinese firms in 37 industries was created and analyzed using a hierarchical logistic model to empirically test the relationship between the institution‐led market and technological catch‐up of emerging market enterprises. We demonstrate that the institution‐led market positively affects the catch‐up of emerging market enterprises; furthermore, it significantly moderates the effect of technological discontinuity on the catch‐up. Finally, the theoretical contributions and managerial implications of the present research are discussed.","PeriodicalId":13594,"journal":{"name":"Information Systems & Economics eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2020-03-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"78355280","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
In contrast to the ‘digitization’ and transfer of ‘analog’ administrative procedures into the electronic interaction format, digital transformation involves substantial changes in public administration processes that affect all stages of the administrative cycle, as well as the functions and powers of public authorities. The purpose of these changes is to fundamentally improve management quality and the performance and efficiency of government agencies, and to achieve a higher level of elaboration of and substantiation for legislative, regulatory and project-based decision- making. An analysis of the Federal Project Digital Public Administration demonstrates that its system of goals, indicators and results does not always make it possible to assess the extent to which the final effects mentioned above can be achieved.
{"title":"Digitalization of the State: Traps and Perspectives","authors":"E. Dobrolyubova","doi":"10.2139/ssrn.3555018","DOIUrl":"https://doi.org/10.2139/ssrn.3555018","url":null,"abstract":"In contrast to the ‘digitization’ and transfer of ‘analog’ administrative procedures into the electronic interaction format, digital transformation involves substantial changes in public administration processes that affect all stages of the administrative cycle, as well as the functions and powers of public authorities. The purpose of these changes is to fundamentally improve management quality and the performance and efficiency of government agencies, and to achieve a higher level of elaboration of and substantiation for legislative, regulatory and project-based decision- making. An analysis of the Federal Project Digital Public Administration demonstrates that its system of goals, indicators and results does not always make it possible to assess the extent to which the final effects mentioned above can be achieved.","PeriodicalId":13594,"journal":{"name":"Information Systems & Economics eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2020-03-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"83107495","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The digital technology underlying the concept of Industry 4.0 has brought new disruptive changes to the economy. As an innovative service model, the unique characteristics of the space-sharing economy require the understanding of emotional and psychological aspects in managing such a disruptive service model. We empirically examine the impact of unstructured emotional information that service providers offer (i.e., marketer-generated content) on the popularity and sales of services in space-sharing platforms (e.g., Airbnb) above and beyond objective qualities such as guest ratings or the size and amenities of the properties. For this, we leverage a unique dataset of a large-scale sample of Airbnb listings from New York City (NYC). The results of a panel analysis and a series of robustness checks reveal a curvilinear association between the affective expression of service providers and the sales of their services, that is, the effect of emotional expressions is positive at low levels, but it diminishes at high levels. To address the potential endogeneity, we use a 2SLS-IV approach, and the results validate our findings. Moreover, we conduct a randomized experiment to further establish causal inference. This study makes valuable contributions to the literature on service operation management and the sharing economy. Our findings shed light on how operations managers and service providers can use emotional information in space-sharing platforms. We provide practical examples to guide their actions. These insights also have implications for other platform owners and users to leverage emotional information and improve outcomes.
{"title":"Do Emotions Sell? The Impact of Emotional Expressions on Sales in Space-Sharing Economy","authors":"Xunyi Wang, Meiling Jiang, Wencui Han, Liangfei Qiu","doi":"10.2139/ssrn.3278207","DOIUrl":"https://doi.org/10.2139/ssrn.3278207","url":null,"abstract":"The digital technology underlying the concept of Industry 4.0 has brought new disruptive changes to the economy. As an innovative service model, the unique characteristics of the space-sharing economy require the understanding of emotional and psychological aspects in managing such a disruptive service model. We empirically examine the impact of unstructured emotional information that service providers offer (i.e., marketer-generated content) on the popularity and sales of services in space-sharing platforms (e.g., Airbnb) above and beyond objective qualities such as guest ratings or the size and amenities of the properties. For this, we leverage a unique dataset of a large-scale sample of Airbnb listings from New York City (NYC). The results of a panel analysis and a series of robustness checks reveal a curvilinear association between the affective expression of service providers and the sales of their services, that is, the effect of emotional expressions is positive at low levels, but it diminishes at high levels. To address the potential endogeneity, we use a 2SLS-IV approach, and the results validate our findings. Moreover, we conduct a randomized experiment to further establish causal inference. This study makes valuable contributions to the literature on service operation management and the sharing economy. Our findings shed light on how operations managers and service providers can use emotional information in space-sharing platforms. We provide practical examples to guide their actions. These insights also have implications for other platform owners and users to leverage emotional information and improve outcomes.","PeriodicalId":13594,"journal":{"name":"Information Systems & Economics eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2020-03-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"75026848","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Major legal jurisdictions like the European Union (EU), Switzerland and the US took a stricter stance on ICOs in the period 2017-2018 by imposing anti-money laundering (AML) provisions and know-your-customer (KYC) requirements on ICOs. Shortly after that, a sharp decrease in the number of ICOs was registered. Moreover, this study provides empirical evidence of a negative impact of the introduction of KYC procedure on the amount of raised capital in ICOs. Furthermore, the fundraising impact of additional ICO characteristics like duration, team, vision, rating, and location is also studied in the paper. The study is based on a multivariate regressional analysis of an international sample of 855 ICOs in the period 2015 – September 2019. The paper concludes that introducing a KYC requirement crowds out anonymous (presumably delinquent) investors at the cost of the raised capital. At the same time, the stricter legislation enhances the establishment of a level-playing field for all tokenized financing instruments such as ICOs, security token offerings (STOs) and initial digital offerings (IDOs) thus putting the end of the “gold rush” of the ICOs.
{"title":"Knowing Your Customer: Empirical Implications for Raising Capital through Initial Coin Offerings (ICOs)","authors":"Galia Kondova, P. Shanmuganathan","doi":"10.2139/ssrn.3549478","DOIUrl":"https://doi.org/10.2139/ssrn.3549478","url":null,"abstract":"Major legal jurisdictions like the European Union (EU), Switzerland and the US took a stricter stance on ICOs in the period 2017-2018 by imposing anti-money laundering (AML) provisions and know-your-customer (KYC) requirements on ICOs. Shortly after that, a sharp decrease in the number of ICOs was registered. Moreover, this study provides empirical evidence of a negative impact of the introduction of KYC procedure on the amount of raised capital in ICOs. Furthermore, the fundraising impact of additional ICO characteristics like duration, team, vision, rating, and location is also studied in the paper. The study is based on a multivariate regressional analysis of an international sample of 855 ICOs in the period 2015 – September 2019. The paper concludes that introducing a KYC requirement crowds out anonymous (presumably delinquent) investors at the cost of the raised capital. At the same time, the stricter legislation enhances the establishment of a level-playing field for all tokenized financing instruments such as ICOs, security token offerings (STOs) and initial digital offerings (IDOs) thus putting the end of the “gold rush” of the ICOs.","PeriodicalId":13594,"journal":{"name":"Information Systems & Economics eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2020-03-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"78841848","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
D. Pele, Niels Wesselhöfft, W. Härdle, M. Kolossiatis, Y. Yatracos
The aim of this paper is to derive the main factors that separate cryptocurrencies from the classical assets, by using various classification techniques applied to the daily time series of log-returns. In this sense, a daily time series of asset returns (either cryptocurrencies or classical assets) can be characterized by a multidimensional vector with statistical components like variance, skewness, kurtosis, tail probability, quantiles, conditional tail expectation or GARCH parameters. By using dimension reduction techniques (Factor Analysis) and classification models (Binary Logistic Regression, Discriminant Analysis, Support Vector Machines, K-means clustering, Variance Components Split methods) for a representative sample of cryptocurrencies, stocks, exchange rates and commodities, we are able to classify cryptocurrencies as a new asset class with unique features in the tails of the log-returns distribution. The main result of our paper is the complete separation of the cryptocurrencies from the other type of assets, by using the Maximum Variance Components Split method. In addition, we observe a synchronicity in the evolution of of the cryptocurrencies, compared to the classical assets, mainly due to the tails behaviour of the log-return distribution.
{"title":"A Statistical Classification of Cryptocurrencies","authors":"D. Pele, Niels Wesselhöfft, W. Härdle, M. Kolossiatis, Y. Yatracos","doi":"10.2139/ssrn.3548462","DOIUrl":"https://doi.org/10.2139/ssrn.3548462","url":null,"abstract":"The aim of this paper is to derive the main factors that separate cryptocurrencies from the classical assets, by using various classification techniques applied to the daily time series of log-returns. In this sense, a daily time series of asset returns (either cryptocurrencies or classical assets) can be characterized by a multidimensional vector with statistical components like variance, skewness, kurtosis, tail probability, quantiles, conditional tail expectation or GARCH parameters. By using dimension reduction techniques (Factor Analysis) and classification models (Binary Logistic Regression, Discriminant Analysis, Support Vector Machines, K-means clustering, Variance Components Split methods) for a representative sample of cryptocurrencies, stocks, exchange rates and commodities, we are able to classify cryptocurrencies as a new asset class with unique features in the tails of the log-returns distribution. The main result of our paper is the complete separation of the cryptocurrencies from the other type of assets, by using the Maximum Variance Components Split method. In addition, we observe a synchronicity in the evolution of of the cryptocurrencies, compared to the classical assets, mainly due to the tails behaviour of the log-return distribution.","PeriodicalId":13594,"journal":{"name":"Information Systems & Economics eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2020-03-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"87389099","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
M. Mukhopadhyay, Kaushik Ghosh, Abhisita Chakraborty, A. Sinha
In this case study, we trace the journey of Masayoshi Son, towards his grand vision of taming the global information revolution, using Softbank Group (SBG). We divide this journey into three chapters. In the first chapter, we delve into his inspiration. In the next chapter, we see the birth of Softbank, while applauding his risky endeavor and learning from his embarrassing failures. In the final chapter, we end up with an awe towards his risk-laden steps in embracing the challenges of globalizing SBG using his vision fund.
{"title":"SoftBank Group: A Global Juggernaut or Japanese Jenga","authors":"M. Mukhopadhyay, Kaushik Ghosh, Abhisita Chakraborty, A. Sinha","doi":"10.2139/ssrn.3545035","DOIUrl":"https://doi.org/10.2139/ssrn.3545035","url":null,"abstract":"In this case study, we trace the journey of Masayoshi Son, towards his grand vision of taming the global information revolution, using Softbank Group (SBG). We divide this journey into three chapters. In the first chapter, we delve into his inspiration. In the next chapter, we see the birth of Softbank, while applauding his risky endeavor and learning from his embarrassing failures. In the final chapter, we end up with an awe towards his risk-laden steps in embracing the challenges of globalizing SBG using his vision fund.","PeriodicalId":13594,"journal":{"name":"Information Systems & Economics eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2020-02-27","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"82592756","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-02-16DOI: 10.25300/MISQ/2020/13304
Hind Benbya, Ning Nan, Hüseyin Tanriverdi, Youngjin Yoo
Complexity is all around us in this increasingly digital world. Global digital infrastructure, social media, Internet of Things, robotic process automation, digital business platforms, algorithmic decision making, and other digitally enabled networks and ecosystems fuel complexity by fostering hyper-connections and mutual dependencies among human actors, technical artifacts, processes, organizations, and institutions. Complexity affects human agencies and experiences in all dimensions. Individuals and organizations turn to digitally-enabled solutions to cope with the wicked problems arising out of digitalization. In the digital world, complexity and digital solutions present new opportunities and challenges for information systems (IS) research. The purpose of this special issue is to foster the development of new IS theories on the causes, dynamics, and consequences of complexity in increasing digital sociotechnical systems. In this essay, we discuss the key theories and methods of complexity science, and illustrate emerging new IS research challenges and opportunities in complex sociotechnical systems. We also provide an overview of the five articles included in the special issue. These articles illustrate how IS researchers build on theories and methods from complexity science to study wicked problems in the emerging digital world. They also illustrate how IS researchers leverage the uniqueness of the IS context to generate new insights to contribute back to complexity science.
{"title":"Complexity and Information Systems Research in the Emerging Digital World","authors":"Hind Benbya, Ning Nan, Hüseyin Tanriverdi, Youngjin Yoo","doi":"10.25300/MISQ/2020/13304","DOIUrl":"https://doi.org/10.25300/MISQ/2020/13304","url":null,"abstract":"Complexity is all around us in this increasingly digital world. Global digital infrastructure, social media, Internet of Things, robotic process automation, digital business platforms, algorithmic decision making, and other digitally enabled networks and ecosystems fuel complexity by fostering hyper-connections and mutual dependencies among human actors, technical artifacts, processes, organizations, and institutions. Complexity affects human agencies and experiences in all dimensions. Individuals and organizations turn to digitally-enabled solutions to cope with the wicked problems arising out of digitalization. In the digital world, complexity and digital solutions present new opportunities and challenges for information systems (IS) research. The purpose of this special issue is to foster the development of new IS theories on the causes, dynamics, and consequences of complexity in increasing digital sociotechnical systems. In this essay, we discuss the key theories and methods of complexity science, and illustrate emerging new IS research challenges and opportunities in complex sociotechnical systems. We also provide an overview of the five articles included in the special issue. These articles illustrate how IS researchers build on theories and methods from complexity science to study wicked problems in the emerging digital world. They also illustrate how IS researchers leverage the uniqueness of the IS context to generate new insights to contribute back to complexity science.","PeriodicalId":13594,"journal":{"name":"Information Systems & Economics eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2020-02-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"86120630","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Cryptocurrencies represent an asset class featuring two unique properties: they are not backed by sovereigns, and their supply is fixed exogenously. This combination becomes apparent in their volatility, which is driven only by demand-side factors. In particular, cryptocurrencies represent an extreme case of the excess volatility puzzle, with asset prices moving more than the fundamentals. We explore the effects of market capitalization on the dynamics of cryptocurrencies within both returns and volatility networks and show that these cryptocurrencies exhibit scaling properties in volatility with respect to market capitalization. The dependency network suggests that currencies with a larger market share have a larger presence in the dominant eigenspectrum, and they exert more influence in the co movement network. In these regards, we find parallels between the dynamics of cryptocurrencies and those of more traditional asset classes. Our findings have implications for both researchers and practitioners in terms of modeling and analyzing the collective behavior of financial assets.
{"title":"Universalities in the Dynamics of Cryptocurrencies: Stability, Scaling and Size","authors":"A. Pogudin, Anindya S. Chakrabati, T. Di Matteo","doi":"10.21314/JNTF.2019.057","DOIUrl":"https://doi.org/10.21314/JNTF.2019.057","url":null,"abstract":"Cryptocurrencies represent an asset class featuring two unique properties: they are not backed by sovereigns, and their supply is fixed exogenously. This combination becomes apparent in their volatility, which is driven only by demand-side factors. In particular, cryptocurrencies represent an extreme case of the excess volatility puzzle, with asset prices moving more than the fundamentals. We explore the effects of market capitalization on the dynamics of cryptocurrencies within both returns and volatility networks and show that these cryptocurrencies exhibit scaling properties in volatility with respect to market capitalization. The dependency network suggests that currencies with a larger market share have a larger presence in the dominant eigenspectrum, and they exert more influence in the co movement network. In these regards, we find parallels between the dynamics of cryptocurrencies and those of more traditional asset classes. Our findings have implications for both researchers and practitioners in terms of modeling and analyzing the collective behavior of financial assets.","PeriodicalId":13594,"journal":{"name":"Information Systems & Economics eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2020-02-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"78419550","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This paper provides a brief analysis on risks associated with the Mobile Financial Services (MFS). In current context where the position of mobile phone has strengthened in the financial services value chain, MFS have become popular and convenient way of making payments. Risk management mechanism for mobile financial industry is critical compared to other financial services that may not widely connected to the advanced technologies and permit the financial institution to control most part of the services directly within the institution. This paper briefly analyzes the method of managing the risks such as operational risks, strategic risks, reputation and compliance risks associated with the MFS. It has been realized that financial institutions have introduced wide array of mobile financial services that consist of innovative products and state-of-the-art technologies to accomplish modern customer needs and convenience. Advanced technology and user-friendly mobile applications are more prone to risks and fraudulent activities. Therefore, implementing proper supervisory and regulatory measures are vital to safeguard both service providers and consumers and ultimately financial systems stability of the country. Accordingly, major recent regulatory measures that have been taken by the Central Bank of Sri Lanka on managing risks of MFS has also been discussed in this paper.
{"title":"Risk Management of Mobile Financial Services (MFS)","authors":"K A Thamara Nilmini Senarathna","doi":"10.2139/ssrn.3533743","DOIUrl":"https://doi.org/10.2139/ssrn.3533743","url":null,"abstract":"This paper provides a brief analysis on risks associated with the Mobile Financial Services (MFS). In current context where the position of mobile phone has strengthened in the financial services value chain, MFS have become popular and convenient way of making payments. Risk management mechanism for mobile financial industry is critical compared to other financial services that may not widely connected to the advanced technologies and permit the financial institution to control most part of the services directly within the institution. This paper briefly analyzes the method of managing the risks such as operational risks, strategic risks, reputation and compliance risks associated with the MFS. It has been realized that financial institutions have introduced wide array of mobile financial services that consist of innovative products and state-of-the-art technologies to accomplish modern customer needs and convenience. Advanced technology and user-friendly mobile applications are more prone to risks and fraudulent activities. Therefore, implementing proper supervisory and regulatory measures are vital to safeguard both service providers and consumers and ultimately financial systems stability of the country. Accordingly, major recent regulatory measures that have been taken by the Central Bank of Sri Lanka on managing risks of MFS has also been discussed in this paper.","PeriodicalId":13594,"journal":{"name":"Information Systems & Economics eJournal","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2020-02-07","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"79879296","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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