Role of Fintech in Transforming Financial Systems: A Study of Stock Markets, Capital Formation, and Entrepreneurial Ecosystems
DOI:
https://doi.org/10.66635/qch08073Keywords:
Fintech, Capital Formation, Stock Markets, Entrepreneurial Ecosystems, Financial SystemsAbstract
The contribution of fintech to the evolution of financial systems in its effects on capital formation, involvement in the stock market and entrepreneur ecosystems. The analysis is based on an examination of 2,000 startups to study the trends in funding, the distributions of the industry, and the nature of firms to understand the effects of activities associated with fintech on the financial development. The amount of capital formation is measured by funding levels, and the integration of the stock market by IPO-stage is used as a proxy to the same. The results show that capital accumulation is largely encouraged by the funding course, and IPO-stage companies demonstrate the most achieved levels of financial mobilization. The startups in the finance sector have shown relatively greater levels of funding, which underscores the capital-intensive fintech innovation. Besides, the findings indicate that IPO-stage companies are a pivotal linking point between familial investment systems and market-based funds. The presence of country-level differences also supports the significance of maturity in entrepreneurial ecosystem in determining financial performance. In general, the study gives empirical data that fintech has played a role in the transformation of the financial system through increasing the efficiency of capital allocation, aiding the integration of markets, and developing innovation-based ecosystems. Although it encounters some proxy measurement constraints, the results provide useful information to policy makers, investors, and those researchers who intend to learn about the changing dynamics of fintech and financial systems.
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