Examines the impact of FinTech Innovation Regulatory Pilot on bank development and risk resilience in China, suggesting implications for policy and practice.
This study examines the impact of China’s FinTech Innovation Regulatory Pilot (a regulatory sandbox) on bank FinTech development. Analyzing a panel of 350 Chinese banks (2015–2024) with a Difference-in-Differences design, we find the Pilot significantly promotes bank FinTech. The effect channels through enhanced bank-tech firm cooperation and accelerated internal digital transformation. The positive impact is stronger for large state-owned banks, banks with FinTech subsidiaries, and technology-pathway patents. Furthermore, the Pilot improves bank profitability and reduces risk. These findings offer clear insights: for policymakers, on designing effective innovation policy; for practitioners, on the strategic value of engagement and partnerships; and for scholars, on the mechanisms of innovation-friendly regulation.
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Zheng et al. (2026) studied this question.
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