Financial Technology and Economic Growth in the United Kingdom (2007-2023): Econometric Descriptive Analysis

Abstract

This study examined the impact of financial technology on economic growth in the United Kingdom from the period 2007-2023. The study utilized the ARDL bound test approach to analyze the results using a time series technique. Point of sales, automated teller machines, and direct debit payment were adopted as measures of financial technology, while GDP per capita was used as the economic growth indicator. The study also controlled using population growth rate and regulatory quality. The findings showed that point of sales positively and significantly impacted GDP per capita in the United Kingdom. Further results revealed that both Automated teller machines and Direct debit payments negatively and non-significantly impacted GDP per capita in the United Kingdom. Based on the result, the study recommends that to ensure operational efficiency of the point of sales (POS) system, regulatory agencies (FCA) and digital financial service providers must continue to integrate newer innovations and prioritize the security of customer information which improves and enhances customer satisfaction. There is a need for regulatory policies that encourage investors and financial institutions to provide fee-free ATMs across the United Kingdom through tax breaks. The government must deliver regulations that encourage cardless policies as well as stimulate innovative competition within the fintech payment industry in the United Kingdom.