| Abstract [eng] |
The development of innovative financial services is transforming the entire financial sector. It encourages takes attention to global trends such as the rapid development of innovative technologies, the global digitalization of financial services, the "FinTech" ecosystem, new partnerships, increased investment in "FinTech", and overall competition in the financial sector, which are leading to uncertainty to banks' long-term profitability. In response to the digitalization of the financial market, traditional financial market participants are seeking to upgrade processes, old infrastructures, and financial services expeditiously by integrating and deploying innovative technologies in their systems to reach their end-users promptly. In the age of digital development, the integration of innovative technologies in the financial sector is still at the level of implementation and rapid development, so this research focuses on innovative financial services. The first part of the research reveals the relevance of the problem of the impact of innovative financial services on the profitability of banks. The next part of the research shows that the authors of the scientific literature evaluate the impact of innovative financial services and internal factors of banks on the profitability of banks. It is pointed out that most common researchers aim to identify areas for improvement in banks and to introduce innovative financial products promptly that could help to increase the profitability of banks in the long run. The results of the research presented in the scientific literature allow to select significant indicators for the profitability of banks and show the necessity of research continuity, as different dependence of technological innovations on the return of banks is determined. In the third part of the research, the methodology is formed. In the last part of the research, an empirical study evaluates the impact of innovative financial services on the return on assets and equity of banks in the European Union. The research shows that banks in the European Union need to continuously improve their online and mobile banking products in the long term, as this has a significant positive impact on the profitability of banks' assets and equity. Banks in the European Union should also encourage the introduction of point-of-sale payment card readers, as this has a significant impact on bank returns. However, banks should continue to reduce the number of their branches as their impact on profitability is negligible. |
