The Political and Economic Impacts of Digital Financial Transformation: Digital Banks as a Model

Abstract

This research aims to study the digital financial transformation and its impact on the banking sector by analyzing digital banks as a product of the development of financial technology. The research focuses on understanding the political and economic dimensions accompanying this transformation and its impact on the structure of the traditional financial system and the public policies of countries. The research reviews the theoretical concepts of digital transformation and analyzes global digital financial inclusion statistics, highlighting the regulatory challenges facing digital banks and the need to achieve a balance between financial innovation and legal oversight. The research also demonstrates the theoretical importance of enriching the academic literature in this field and the practical importance of helping policymakers and banking institutions make informed decisions towards adopting digital transformation in a safe and sustainable manner. The research concludes that banking digitization represents a radical transformation that requires the development of legal and economic frameworks to keep pace with it. Digital Financial Inclusion Rate (2023) China: 90% (200 million digital users). India: 85% (180 million users). European Union: 80% (150 million users). United States: 75% (120 million users). Japan: 65% (80 million users).