Has Fintech Influenced Indonesia's Exchange Rate and Inflation?

Narayan, S and Sahminan, S 2018, 'Has Fintech Influenced Indonesia's Exchange Rate and Inflation?', Bulletin of Monetary Economics and Banking, vol. 21, no. 2, pp. 189-201.


Document type: Journal Article
Collection: Journal Articles

Title Has Fintech Influenced Indonesia's Exchange Rate and Inflation?
Author(s) Narayan, S
Sahminan, S
Year 2018
Journal name Bulletin of Monetary Economics and Banking
Volume number 21
Issue number 2
Start page 189
End page 201
Total pages 13
Publisher Bank Indonesia
Abstract The digital financial services industry, or financial technology (FinTech), has emerged in Indonesia in recent years. The FinTech industry, although disruptive, promises among other things to reduce costs of, and improve access to, financial services. This paper investigates the macroeconomic implications of FinTech companies in Indonesia over the period 1998-2017. In particular, we investigate the impact of FinTech on the Indonesian exchange rate (rupiah vis-a-vis the US dollar) and the inflation rate. Our results suggest that FinTech is able to reduce inflation and lead to a real appreciation of the rupiah against the US dollar, although its effect on the exchange rate is delayed. We explain our results and discuss future research directions.
Subject International Economics and International Finance
Macroeconomics (incl. Monetary and Fiscal Theory)
Keyword(s) FinTech
Real Exchange Rate
Inflation
Indonesia.
DOI - identifier 10.21098/bemp.v21i2.966
Copyright notice © 2018 Open Access, Bulletin of Monetary Economics and Banking is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
ISSN 1410-8046
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