The Role of Fintech and Natural Resources in Financial Stability with a Moderating Analysis of Fintech: Evidence from BRICS

Sadat Hussain; Muhammad Yusuf Amin; Shehzad Khan

doi:10.62270/jirms.v5i4.91

Authors

Sadat Hussain Ms Scholar, Institute of Business Studies and Leadership, Abdul Wali Khan University Mardan, Pakistan
Muhammad Yusuf Amin Assistant Professor, Institute of Business Studies and Leadership, Abdul Wali Khan University Mardan, Pakistan
Shehzad Khan Associate Professor, Institute of Business Studies and Leadership, Abdul Wali Khan University Mardan, Pakistan

DOI:

https://doi.org/10.62270/jirms.v5i4.91

Keywords:

Natural Resources, Fintech, Financial Stability, Economic Growth

Abstract

Purpose—Financial stability has been a critical concern in all countries, with a considerable impact on economic progress. As a result, every nation has worked to promote financial stability by implementing various strategies aimed at enhancing financial development and economic growth. The current study examines the effect of natural resources on financial stability, considering the role of Fintech in BRICS economies.

Design/methodology/approach—The study applied first-generation approaches, including unit root tests for series stationarity, a panel co-integration test, and panel-ARDL to investigate long-run relationships. The direction of the causal relationship is also determined using the Granger causality test.

Findings—This study explored the negative impact of natural resources, whilst the positive impact of Fintech on financial stability. Moreover, a significant and positive moderating role of Fintech in the natural resources rent and financial stability nexus suggests that Fintech plays a critical role in minimizing the negative effect of natural resources on financial stability.

Practical Implications—In light of data availability, the study used data from 2004 to 2021, which is a small sample size for panel estimations.

Originality/value—Previously, researchers have clearly addressed the role of natural resources in financial development and economic growth. To the best of the author’s knowledge, no previous research has attempted to examine the role of natural resources in financial stability. Moreover, literature has ignored the important role of fintech in turning the natural resource curse into a blessing. This study investigates the impact of natural resources on financial stability and the moderating role of Fintech, the natural resources, and financial stability nexus in BRICS economies.

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