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This paper aims to examine how the rise of financial technology (Fintech) lending affects bank competition. Moreover, this study also identifies the structure of Indonesian commercial banking sector and the different behaviour of competition among bank groups (based on their size, type and ownership) and the joint impact of COVID-19 due to the rise of Fintech lending.

Using an unbalanced panel data set of 118 commercial banks in Indonesia over the period 2018–2022, both static panel and 2SLS/IV data analysis were used and found that random effect model is the best model.

The results show that the Indonesian commercial banking sector can be considered as monopolistic competition. Moreover, using the Lerner index reveals that the entry of the Fintech lenders increases bank competition. Furthermore, there were different responses to the impact of Fintech lending on bank competition among state-owned banks, private banks, regional development banks and foreign banks. Greater efficiency and stability lead to greater market power. In the meantime, higher level of asset growth, capitalisation and cost-to-income ratio increase the competition. Lastly, higher bank credit growth and lower inflation boost overall bank competitiveness.

This study highlights some policy recommendations for commercial banks to be aware of the coming of Fintech lenders because they have started to increase the market competition. The government should create a more collaborative ecosystem between banks and Fintech lending to anticipate unhealthy competition.

This study will contribute to the literature by expanding the determinants of bank competition by considering the rise of Fintech lending in the market.

This study aims to investigate a possible transmission mechanism by which the coming of financial technology (FinTech) lending can contribute to enhance the competitiveness of commercial banks and considered to affect banks’ efficiency. In addition, this study also identifies the different responses among bank groups (based on their size, type and ownership) and the joint impact of COVID-19 on the FinTech lending-competition-efficiency nexus.

Using an unbalanced panel data set of 118 commercial banks in Indonesia over the period 2018–2022, static panel (fixed and random effect model) and 2SLS/IV data analysis were used to accommodate possibility of endogeneity problem.

The results, using the stochastic frontier analysis for cost efficiency, show that higher competition leads to cost efficiency, providing evidence to support the quiet life hypothesis. However, the emergence of FinTech lending enhanced bank competitiveness, reducing the cost efficiency of Indonesian commercial banks. The negative relationship between the FinTech lending expansion and the level of cost efficiency supports this finding. Furthermore, different responses were found to the impact of FinTech lending on bank efficiency among different bank groupings. The banks were found to be less efficient in the COVID-19 period due to the coming of FinTech lending. This study signals stakeholders, especially Indonesian commercial banks, to anticipate the impact of higher competition created by FinTech lenders, which leads to bank inefficiencies. Other variables, such as asset growth, profitability and liquidity, positively impact cost efficiency, while the nonperforming loan negatively affects cost efficiency. Finally, a higher bank credit growth and lower inflation rate boost cost efficiency.

This study highlights some policy recommendations for commercial banks to be aware of the coming of FinTech lenders since they moderate the competition-efficiency nexus by reducing the efficiency level. Hence, the government should create a more collaborative ecosystem between banks and Fintech lending and provide legal authority for the FinTech industry to support the acceleration of digital transformation in the Indonesian banking industry.

This study will contribute to the literature by carrying out the transmission from the emergence of FinTech lending to bank efficiency, which includes the moderating role of FinTech lending development on the competition-efficiency nexus in banking.

The purpose of this study is to empirically test the role of heterogeneous investor’s, i.e. institutional investors, individuals and insiders in deteriorating market integrity.

The research is conducted by examining the participants of 244 market manipulation cases of East Asian emerging and developed financial markets for the period of 2001–2016. The empirical analysis is conducted using panel logistic regression.

The results show that firms with higher institutional ownership are most likely to be manipulated in both markets. Insiders are potential manipulators in developed markets and deteriorate market integrity. In contrast, individual investors behave differently in both markets. In developed markets, firms with high individual ownership are less likely to be manipulated while in emerging markets, firms with individual ownership are more prone to manipulation because of substantial participation by individual investors which invites manipulative practices. Additionally, the authors found that firms with a higher proportion of passive institutional investors are less likely to be manipulated in emerging markets.

This study contributes to the existing literature by identifying the potential manipulators in the financial markets who deteriorate market integrity with the additional focus of subdivision of institutional investors as active institutional investors and passive institutional investor. The findings are helpful for regulators in designing policies to ensure market integrity and to enforce the role of institutional investors and insiders.