Digitalization in financial services and household finance: fintech, financial literacy and financial stability
Digitalization and the emerging fintech industry offer a large variety of new products and ways to save, and the process of matching savers with investors will become more direct and the share of wealth invested through other channels than the traditional bank lending channel will increase further.
Abstract
In this study we characterize and discuss digitalization in the financial services industry, focusing on the link between fintech and financial stability. Digitalization and the emerging fintech industry offer a large variety of new products and ways to save. As a result, the process of matching savers with investors will become more direct and the share of wealth invested through other channels than the traditional bank lending channel will increase further. At the same time, the volume of intermediated private wealth is rising as a share of GDP. These developments will likely require changes in regulation and supervision but also new approaches toward financial education, as the more direct link between savers and investors calls for new forms of financial literacy.