This paper examines the effect of FinTech lending on the market power and stability of incumbent banks. Using an international sample of 6,225 banks during the period 2013–2019, our results show that the volume of credit provided by FinTech lenders negatively affects bank market power and stability. These results are influenced by the legal framework and institutional quality of each jurisdiction. Furthermore, the impact of FinTech lending on bank stability is partially channeled by the effect of FinTech credit on the market power of incumbent banks. Our main results – lower bank market power and bank stability – are also observed at the country level and after addressing potential endogeneity concerns. Regarding policy implications, more prudential regulation on FinTech activity is needed to address information imbalance issues and potential risks stemming from their activities. Furthermore, reinforcing the legal framework and institutional structure could serve to mitigate the adverse effects of FinTech lending on the traditional commercial banking sector.

中文翻译：

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数字颠覆者已近在眼前。金融科技贷款是否会影响银行市场力量和稳定性？

本文研究了金融科技贷款对现有银行的市场力量和稳定性的影响。我们使用 2013 年至 2019 年期间 6,225 家银行的国际样本，结果表明，金融科技贷方提供的信贷量对银行市场力量和稳定性产生负面影响。这些结果受到每个司法管辖区的法律框架和制度质量的影响。此外，金融科技贷款对银行稳定性的影响部分是通过金融科技信贷对现有银行市场力量的影响来体现的。我们的主要结果——较低的银行市场力量和银行稳定性——也在国家层面以及解决潜在的内生性问题后得到观察。在政策影响方面，需要对金融科技活动进行更加审慎的监管，以解决信息不平衡问题和其活动带来的潜在风险。此外，加强法律框架和制度结构可以有助于减轻金融科技贷款对传统商业银行业的不利影响。