|
on Payment Systems and Financial Technology |
| By: | Khaira Amalia Fachrudin (Universitas Sumatera Utara, Jalan TM Hanafiah, Kampus USU, 20155, Medan, Indonesia Author-2-Name: Muhammad Faidhil Iman Author-2-Workplace-Name: Universitas Indonesia, Jalan Lingkar Kampus Raya, 16424, Depok, Indonesia Author-3-Name: Khairina Sariza Muliana Author-3-Workplace-Name: "Universitas Sumatera Utara, Jalan TM Hanafiah, Kampus USU, 20155, Medan, Indonesia " Author-4-Name: Author-4-Workplace-Name: Author-5-Name: Author-5-Workplace-Name: Author-6-Name: Author-6-Workplace-Name: Author-7-Name: Author-7-Workplace-Name: Author-8-Name: Author-8-Workplace-Name:) |
| Abstract: | " Objective - A national cashless movement is actively being promoted in Indonesia. This research aims to offer empirical insights into how practicality, lifestyle, digital financial literacy, perceived trust, and price orientation affect cashless payment adoption and whether it affects satisfaction with using these systems. This study further explores how the adoption of cashless payments functions as a mediating variable in the relationship between five key factors and user satisfaction with cashless payment usage. Methodology/Technique - The sample consisted of 400 income-earning individuals in Indonesia who had previously used cashless payment methods. Using partial least squares structural equation modeling (PLS-SEM) with a 5% significance level, the findings indicate that practicality, lifestyle, digital financial literacy, perceived trust, and price orientation all exert a significant and positive influence on the adoption of cashless payments. Satisfaction with cashless payments is positively and significantly affected by their adoption. Findings - Cashless payment adoption mediates the effects of price orientation, practicality, digital financial literacy, perceived trust, and lifestyle on satisfaction. The results suggest that companies should implement appealing or competitive pricing strategies to encourage consumers to use cashless payments. Novelty - Financial service providers should prioritize practicality and security to build trust in cashless payment systems. Finally, the government and educational institutions should provide continuous education initiatives to promote digital financial literacy among the public. Type of Paper - Empirical" |
| Keywords: | Practicality, Lifestyle, Digital Financial Literacy, Price Orientation, Cashless Payment. |
| JEL: | D12 O33 G21 E42 |
| Date: | 2025–06–30 |
| URL: | https://d.repec.org/n?u=RePEc:gtr:gatrjs:afr239 |
| By: | Matteo Bonato (Department of Economics and Econometrics, University of Johannesburg, Auckland Park, South Africa; IPAG Business School, 184 Boulevard Saint-Germain, 75006 Paris, France); Riza Demirer (Department of Economics and Finance, Southern Illinois University Edwardsville, Edwardsville, IL 62026-1102, USA); Rangan Gupta (Department of Economics, University of Pretoria, Private Bag X20, Hatfield 0028, South Africa); Abeeb Olaniran (Department of Economics, University of Pretoria, Private Bag X20, Hatfield 0028, South Africa) |
| Abstract: | This paper explores the role of mining activity, proxied by growth rates of electricity consumption and cost of mining, as a driver of pricing inefficiencies in cryptocurrencies. Utilizing alternative measures of crash risk proxied by the realized negative coefficient of skewness and realized down-to-up volatility, derived based on 5-minute intraday Bitcoin data, nonparametric causality-in-quantiles tests, along with sign analysis, captured by the estimates of partial average derivatives, provide evidence that mining activity can, in general, predict an increase in the entire conditional distribution of crash risk, with the strongest impact associated over the normal (median) to moderately high (upper quantiles) levels of risk. Despite the emergence of these assets in international transactions and as an investment vehicle, our results suggest that decentralized mining process can contribute to inefficiencies in the pricing of cryptocurrencies, putting further doubt into the role of these assets as a medium of exchange, alternative to conventional assets. |
| Keywords: | Crypto currencies, Crash risk, Mining activity, Nonparametric causality-in-quantiles |
| JEL: | C22 C53 G10 |
| Date: | 2025–09 |
| URL: | https://d.repec.org/n?u=RePEc:pre:wpaper:202530 |
| By: | Philippe Bergault; S\'ebastien Bieber; Olivier Gu\'eant; Wenkai Zhang |
| Abstract: | In traditional financial markets, yield curves are widely available for countries (and, by extension, currencies), financial institutions, and large corporates. These curves are used to calibrate stochastic interest rate models, discount future cash flows, and price financial products. Yield curves, however, can be readily computed only because of the current size and structure of bond markets. In cryptocurrency markets, where fixed-rate lending and bonds are almost nonexistent as of early 2025, the yield curve associated with each currency must be estimated by other means. In this paper, we show how mathematical tools can be used to construct yield curves for cryptocurrencies by leveraging data from the highly developed markets for cryptocurrency derivatives. |
| Date: | 2025–09 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2509.03964 |
| By: | Jo\~ao B. G. de Brito; Rodrigo Heldt; Cleo S. Silveira; Matthias Bogaert; Guilherme B. Bucco; Fernando B. Luce; Jo\~ao L. Becker; Filipe J. Zabala; Michel J. Anzanello |
| Abstract: | The emergence of Open Banking represents a significant shift in financial data management, influencing financial institutions' market dynamics and marketing strategies. This increased competition creates opportunities and challenges, as institutions manage data inflow to improve products and services while mitigating data outflow that could aid competitors. This study introduces a framework to predict customers' propensity to share data via Open Banking and interprets this behavior through Explanatory Model Analysis (EMA). Using data from a large Brazilian financial institution with approximately 3.2 million customers, a hybrid data balancing strategy incorporating ADASYN and NEARMISS techniques was employed to address the infrequency of data sharing and enhance the training of XGBoost models. These models accurately predicted customer data sharing, achieving 91.39% accuracy for inflow and 91.53% for outflow. The EMA phase combined the Shapley Additive Explanations (SHAP) method with the Classification and Regression Tree (CART) technique, revealing the most influential features on customer decisions. Key features included the number of transactions and purchases in mobile channels, interactions within these channels, and credit-related features, particularly credit card usage across the national banking system. These results highlight the critical role of mobile engagement and credit in driving customer data-sharing behaviors, providing financial institutions with strategic insights to enhance competitiveness and innovation in the Open Banking environment. |
| Date: | 2025–06 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2507.01987 |
| By: | Giorgos Demosthenous; Chryssis Georgiou; Eliada Polydorou |
| Abstract: | This study investigates the impact of data source diversity on the performance of cryptocurrency forecasting models by integrating various data categories, including technical indicators, on-chain metrics, sentiment and interest metrics, traditional market indices, and macroeconomic indicators. We introduce the Crypto100 index, representing the top 100 cryptocurrencies by market capitalization, and propose a novel feature reduction algorithm to identify the most impactful and resilient features from diverse data sources. Our comprehensive experiments demonstrate that data source diversity significantly enhances the predictive performance of forecasting models across different time horizons. Key findings include the paramount importance of on-chain metrics for both short-term and long-term predictions, the growing relevance of traditional market indices and macroeconomic indicators for longer-term forecasts, and substantial improvements in model accuracy when diverse data sources are utilized. These insights help demystify the short-term and long-term driving factors of the cryptocurrency market and lay the groundwork for developing more accurate and resilient forecasting models. |
| Date: | 2025–06 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2506.21246 |
| By: | Rischan Mafrur |
| Abstract: | The tokenization of real-world assets (RWAs) promises to transform financial markets by enabling fractional ownership, global accessibility, and programmable settlement of traditionally illiquid assets such as real estate, private credit, and government bonds. While technical progress has been rapid, with over \$25 billion in tokenized RWAs brought on-chain as of 2025, liquidity remains a critical bottleneck. This paper investigates the gap between tokenization and tradability, drawing on recent academic research and market data from platforms such as RWA.xyz. We document that most RWA tokens exhibit low trading volumes, long holding periods, and limited investor participation, despite their potential for 24/7 global markets. Through case studies of tokenized real estate, private credit, and tokenized treasury funds, we present empirical liquidity observations that reveal low transfer activity, limited active address counts, and minimal secondary trading for most tokenized asset classes. Next, we categorize the structural barriers to liquidity, including regulatory gating, custodial concentration, whitelisting, valuation opacity, and lack of decentralized trading venues. Finally, we propose actionable pathways to improve liquidity, ranging from hybrid market structures and collateral-based liquidity to transparency enhancements and compliance innovation. Our findings contribute to the growing discourse on digital asset market microstructure and highlight that realizing the liquidity potential of RWAs requires coordinated progress across legal, technical, and institutional domains. |
| Date: | 2025–08 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2508.11651 |
| By: | Grodecka-Messi, Anna (Financial Stability Department, Central Bank of Sweden); Zhang, Xin (Research Department, Central Bank of Sweden) |
| Abstract: | Private money creation lies at the heart of currency competition due to seigniorage rents that are an important contributor to banks’ franchise values. However, it undermines the role of central bank in money provision and has been historically a contentious issue. As shifting from private to public money may come at a cost of bank disintermediation and affect economic growth, such a swap should be well-planned to minimize its costs. In this paper, we study the transition from private to public money in a historical context. The 1897 banking law in Sweden granted the banknote monopoly to the Swedish central bank. To facilitate the shift, the central bank provided preferential liquidity support to formerly note-issuing private banks. Drawing on newly digitized monthly archival data, we show that this liquidity provision played a critical role in shaping private banks’ performances during the transition. Once the support started being withdrawn, affected banks experienced a 23% drop in profitability. No signs of bank disintermediation are found. |
| Keywords: | Money and Banking; Inside Money; Outside Money; Bank Profitability; Bank Lending; Banknote Monopoly |
| JEL: | E42 E50 G21 G28 N23 |
| Date: | 2025–08–01 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:rbnkwp:0454 |
| By: | Igor Halperin |
| Abstract: | This work builds upon the long-standing conjecture that linear diffusion models are inadequate for complex market dynamics. Specifically, it provides experimental validation for the author's prior arguments that realistic market dynamics are governed by higher-order (cubic and higher) non-linearities in the drift. As the diffusion drift is given by the negative gradient of a potential function, this means that a non-linear drift translates into a non-quadratic potential. These arguments were based both on general theoretical grounds as well as a structured approach to modeling the price dynamics which incorporates money flows and their impact on market prices. Here, we find direct confirmation of this view by analyzing high-frequency crypto currency data at different time scales ranging from minutes to months. We find that markets can be characterized by either a single-well or a double-well potential, depending on the time period and sampling frequency, where a double-well potential may signal market uncertainty or stress. |
| Date: | 2025–09 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2509.02941 |
| By: | Pablo Cotler (Universidad Iberoamericana Mexico City) |
| Abstract: | This study examines the relationship between financial inclusion and the continued use of informal savings in Mexico, using data from three waves of the national financial inclusion survey and instrumental variable techniques. Despite increased account ownership, informal saving practices have not declined. Findings suggest that financial access, infrastructure, and education alone are insufficient to change saving behavior. Policies should consider incorporating features of informal mechanisms, such as rotating savings groups or cooperative models. A deeper understanding of household motivations are needed, and future surveys must capture user experiences to design more inclusive strategies that address persistent financial inequalities. |
| JEL: | D14 G21 O17 |
| Date: | 2025–09–02 |
| URL: | https://d.repec.org/n?u=RePEc:smx:wpaper:2025002 |
| By: | Sabrina Aufiero; Silvia Bartolucci; Fabio Caccioli; Pierpaolo Vivo |
| Abstract: | This work explores the formation and propagation of systemic risks across traditional finance (TradFi) and decentralized finance (DeFi), offering a comparative framework that bridges these two increasingly interconnected ecosystems. We propose a conceptual model for systemic risk formation in TradFi, grounded in well-established mechanisms such as leverage cycles, liquidity crises, and interconnected institutional exposures. Extending this analysis to DeFi, we identify unique structural and technological characteristics - such as composability, smart contract vulnerabilities, and algorithm-driven mechanisms - that shape the emergence and transmission of risks within decentralized systems. Through a conceptual mapping, we highlight risks with similar foundations (e.g., trading vulnerabilities, liquidity shocks), while emphasizing how these risks manifest and propagate differently due to the contrasting architectures of TradFi and DeFi. Furthermore, we introduce the concept of crosstagion, a bidirectional process where instability in DeFi can spill over into TradFi, and vice versa. We illustrate how disruptions such as liquidity crises, regulatory actions, or political developments can cascade across these systems, leveraging their growing interdependence. By analyzing this mutual dynamics, we highlight the importance of understanding systemic risks not only within TradFi and DeFi individually, but also at their intersection. Our findings contribute to the evolving discourse on risk management in a hybrid financial ecosystem, offering insights for policymakers, regulators, and financial stakeholders navigating this complex landscape. |
| Date: | 2025–08 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2508.12007 |
| By: | B K Meister |
| Abstract: | Bitcoin treasury companies have taken stock markets by storm amassing billions of dollars worth of tokens. More than a hundred companies active in various crypto-tokens, not just Bitcoin, are listed. The ability to generate leverage, for example stemming from borrowing collateralized by stock portfolios, helps to understand this phenomenon. In addition, the extension of the binary-choice Kelly criterion to incorporate uncertainty in the form of the Kullback-Leibler divergence or more generally Bregman divergence is studied. |
| Date: | 2025–07 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2507.14910 |
| By: | Josué Mendoza (Centro de Estudios Espinosa Yglesias) |
| Abstract: | Este documento analiza cómo la inclusión financiera de los padres influye en los comportamientos financieros de sus hijos y en la movilidad social en México. Con base en los datos de la Encuesta ESRU de Movilidad Social en México 2023 (ESRU-EMOVI 2023), que tienen representatividad nacional, se observa que tener padres que contaban con al menos un producto financiero formal (por ejemplo, de ahorro o crédito) se asocia con una mayor inclusión financiera y niveles más altos de educación financiera entre la generación siguiente. Sin embargo, la persistencia de diferencias socioeconómicas y de género indica que la mejora en el acceso a los productos financieros por sí sola no puede eliminar plenamente las desigualdades estructurales. Mediante el uso de matrices de movilidad social, regresiones rango-rango y una descomposición de la desigualdad de oportunidades, se muestra además que los hijos de padres que tuvieron inclusión financiera presentan menos probabilidades de permanecer en la parte más baja de la distribución de recursos económicos y tienden a alcanzar posiciones más altas en general. Este análisis de la desigualdad de oportunidades indica que la inclusión financiera de los padres representa alrededor del 16 % de la desigualdad en los resultados socioeconómicos de sus hijos, lo que la convierte en una vía relevante de ventaja intergeneracional. En conjunto, las conclusiones subrayan la importancia tanto de ampliar la inclusión financiera como de complementarla con intervenciones más profundas, como, por ejemplo, iniciativas para fomentar la educación financiera y abordar las desventajas estructurales arraigadas para impulsar una movilidad social más equitativa en los países en desarrollo. |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:auk:ecosoc:2025_5 |
| By: | Jo\~ao B. G. de Brito; Rodrigo Heldt; Cleo S. Silveira; Matthias Bogaert; Guilherme B. Bucco; Fernando B. Luce; Jo\~ao L. Becker; Filipe J. Zabala; Michel J. Anzanello |
| Abstract: | Financial institutions increasingly adopt customer-centric strategies to enhance profitability and build long-term relationships. While Customer Lifetime Value (CLV) is a core metric, its calculations often rely solely on single-entity data, missing insights from customer activities across multiple firms. This study introduces the Potential Customer Lifetime Value (PCLV) framework, leveraging Open Banking (OB) data to estimate customer value comprehensively. We predict retention probability and estimate Potential Contribution Margins (PCM) from competitor data, enabling PCLV calculation. Results show that OB data can be used to estimate PCLV per competitor, indicating a potential upside of 21.06% over the Actual CLV. PCLV offers a strategic tool for managers to strengthen competitiveness by leveraging OB data and boost profitability by driving marketing efforts at the individual customer level to increase the Actual CLV. |
| Date: | 2025–06 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2506.22711 |
| By: | Hellenkamp, Detlef |
| Abstract: | The European, and in particular the German, banking sector is in a phase of profound structural transformation that is characterised by the simultaneous impact and interaction of several macro-structural drivers. Advancing digitalisation - particularly through artificial intelligence (AI) and distributed ledger technology (DLT) - ESG integration as a strategic and regulatory imperative, a tightening regulatory framework (including Basel IV, DORA, EU AI Act, MiCA), demographic changes and intensified competition from digital players and changing customer behaviour are presenting banks with profound challenges. This discussion paper explains the impact of these drivers on business models, risk management, operational resilience, regulatory adjustment requirements and the strategic positioning of banks in the German and European context. It shows that the simultaneous management of these transformations - under conditions of increased complexity and rising demands on capital, technology and personnel - requires integrated management approaches and far-reaching organisational adjustments.In particular, the focus is on: the strategic use of AI, taking into account ethical and regulatory limits, the anchoring of ESG in risk management and product strategy, the impact of Basel IV regulations on the capital structure, and the relevance of demographic shifts for customer interfaces, HR strategies and sales models. The work concludes with the formulation of strategic imperatives for banks as an approach to a future-oriented, resilient and competitive realignment. |
| Keywords: | Strukturwandel Bankwesen; Digitalisierung Banken; KI-Bankwesen; ESG-Banken; Regulierung Banken; DORA (Digital Operational Resilience Act; Tokenisierung Finanzsektor; Risikomanagement Banken; DLT-Banken; Cybersicherheit Banken |
| JEL: | G21 G28 Q33 |
| Date: | 2025–05–07 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:125913 |