Fintech Evolution, Perceived Threats, and Fintech Uptake : Insights from the Financial Landscape of Pakistan

Abstract

Financial technology (Fintech) has made significant strides forward in improving delivery of financial services, yet at its very same time has brought with it many emerging risks that challenge its widespread adoption. This research explores these multidimensional risks from using Fintech within financial service domains; specifically highlighting strategic, operational, cyber, and regulatory uncertainties as significant points of contention. The study explores the intricate relationship between Fintech innovations and intentions to adopt them, and adoption intention, uncovering an unexpected negative correlation. Attributed to increased perceived risks associated with Fintech implementations and potential adopters' hesitation about incorporating such solutions seamlessly. Recognizing auditors' essential role within Fintech entities, this research highlights their capability of mitigating emerging risks with effective protective strategies and investigating their restraining influence in orchestrating Fintech risk management with an all-inclusive framework for risk control. Utilizing a multi-method quantitative approach, this study obtained insights from 200 respondents representing various Fintech enterprises in Pakistan using structured questionnaires as primary data collection instruments and employing Stata version 14.0 statistical software for hypothesis validation. The empirical findings demonstrated a marked escalation in perceived risks as the Fintech revolution intensifies, which had an adverse impact on relationships between Fintech revolution and adoption intentions and auditors, respectively. Furthermore, auditors played an instrumental role in mediating between Fintech revolution and emerging risks, creating an ecosystem with greater resilience and risk awareness.