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Digital transformation in the financial industry creates the new term FinTech, which is a component of the two words “finance” and “technology”, that is, FinTech is a combination of digital technology and financial services. FinTech” provides and enables flexibility, security, greater capabilities, and greater efficiency than existing traditional services and products in the financial industry. FinTech today offers a wide range of products available to companies. Due to a large number of innovations in this area companies following their interests and needs should recognize and know in which areas of FinTech to invest (eg, digital wallets, peer-to-peer lending, e-insurances, bitcoin, artificial intelligence) but also in which geographical areas (Jiao et al, 2021). The research of Pizzi et al (2021) reveals that FinTech has a significant role in the transition of SMEs, which leads to sustainable business, ie the application of a sustainable business model that leads to better connection and integration of the circular economy. “FinTeh” today includes some of the significant areas such as bitcoin and blockchain technology and a novelty in the financial market that are so-called “neobanks”, banks without physical locations. Research by Yao and Song (2021) and Wang Y. et al. (2021) proves that FinTech has an impact on the profitability of different types of commercial banks, which leads to increased profitability, financial innovation, and improved control of risk. The financial industry is a fast-growing industry where innovation is of utmost importance for the growth and development of this industry.
The financial industry and banks were among the first to embrace digital business to meet the needs of customers who do not want to function without digital interaction where today every bank has some form of digital products to ensure and achieve interactive communication and minimal physical contact. How banks will and whether banks will adopt and incorporate new innovative services within their operations largely depends on the behavior of bank consumers. Under the influence of bank consumers, banks assess the impact of expected performance and effort, risk, and how these aspects affect FinTech’s adoption of innovations (Mangini et al., 2021). Given that digital and financial technologies are changing the basic concepts of banking, banks must recognize and make the right investments in financial technologies to achieve and maintain a competitive advantage (Nurbekovich et al., 2020). Through this research, some key areas of FinTech have been explored, such as blockchain technology, bitcoin, cryptocurrencies, neobanks, and their impact on the financial industry.
This paper aims to explore the process of digital transformation in the field of development and application of new technology and the development of innovations in the financial industry that are rapidly evolving daily and pose a great challenge in front of the financial industry. Systematic literature review was conducted to provide an overview of the relevant areas and products of FinTech, and their supporting technologies. To collect data following phrases were used and that is (“digitalization” OR “digital transformation”) and (“FinTech”, “Blockchain Technology”, or “Neobank”). The collected papers were analyzed to review the representation of FinTech in the financial industry and its association with the digital transformation of business.