.Impact of financial factors and banking innovation on financial performance: evidence from commercial banks in Pakistan

Abstract

The banking sector in Pakistan is continuously growing and earns higher profit margin in the financial market. There are many factors that directly impact the financial performance of the banking institutes; from literature, this study identified six major factors including advances, deposits, inflation, electronic funds transfer, mobile banking and internet banking. This research critically analyzed the impact of these independent variables on financial performance, dependent variable. Different theories are used in this literature review regarding technological enhancement in the banking sector. This study used the deductive research approach and secondary data is used for the statistical analysis. In the research, a quantitative research method is used where the financial data, from the Banks' official websites; State Bank of Pakistan, and World Bank were collected and then critically analyze by applying statistical tests. Based on statistical analysis, this research revealed that deposits and advances are highly significant factors which influence financial performance of Pakistani Banks. This reach recommends enhancing the awareness towards the digital services of banks such as internet and mobile banking