Does Digitalisation Have an Impact on Profitability? Evidence from the Turkish Banking Sector
DOI:
https://doi.org/10.20491/isarder.2024.1945Anahtar Kelimeler:
Digital Banking- Mobile BankingÖzet
Purpose – Developments and innovations in information technologies have seriously affected the banking sector as they have affected all sectors. Thus, significant gains have been achieved in terms of transaction speed and costs have been significantly reduced. This study aims to investigate the impact of the digitalisation process in the banking sector on the profitability of the sector. Design/methodology/approach – In the study, quarterly data set for the period 2010/Q4-2024/Q1 is used. Time series analyses are used to examine the relationship between variables. Time series analysis was utilized in the study. Phillip Perron (PP) unit root test was used to determine the stationarity levels of the variables used in the study. ARDL (Autoregressive Distributed Lag Bound Test) bounds test approach was utilized to reveal the long-run relationship between the series. Toda-Yamamoto test was used to test the causality relationship between the variables. Findings – According to the findings obtained as a result of the analyses, it is determined that there is a cointegration relationship between the return on assets of the Turkish banking system and the volume and number of digital banking transactions. According to the results of Toda-Yamamoto causality tests, it was concluded that there is a unidirectional Granger causality relationship between return on assets and digital banking transaction volume, while no causality relationship was found between return on assets and the number of digital banking transactions. It is concluded that digital banking applications have a positive effect on the return on assets of the Turkish Banking sector. Discussion – It is important for banks to increase their service quality by focusing more on digitalisation efforts, to equip their personnel with digital technologies and to aim to increase the use of digital banking applications by making detailed introductions to their customers.
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