The long-term effect of digital innovation on bank performance: An empirical study of SWIFT adoption in financial services

Susan Scott, John Van Reenen, Markos Zachariadis

Research output: Contribution to journalArticlepeer-review

Abstract

We examine the impact on bank performance of the adoption of SWIFT, a network-based technological infrastructure and set of standards for worldwide interbank telecommunication. We construct a new longitudinal dataset of 6848 banks in 29 countries in Europe and the Americas with the full history of adoption since SWIFT’s initial operations in 1977. Our results suggest that the adoption of SWIFT (i) has large effects on profitability in the long-term; (ii) these profitability effects are greater for small than for large banks; and (iii) exhibits significant network effects on performance. We use an in-depth field study to better understand the mechanisms underlying the effects on profitability.
Original languageEnglish
Pages (from-to)984
Number of pages1004
JournalResearch Policy
Volume46
Issue number5
Early online date6 Apr 2017
DOIs
Publication statusPublished - Jun 2017

Keywords

  • Technology adoption
  • Bank performance
  • Financial services
  • Network innovation
  • SWIFT

Fingerprint

Dive into the research topics of 'The long-term effect of digital innovation on bank performance: An empirical study of SWIFT adoption in financial services'. Together they form a unique fingerprint.

Cite this