FEATURES OF DIGITAL TRANSFORMATION OF THE BANKING SECTOR OF UKRAINE

Abstract

The rapid digitalization of all spheres of life is the main trend of recent years. The banking sector was one of the first to actively respond to changes in the global economic system and is now one of the leaders in the process of financial services digitalization. The article is devoted to the study of the digitalization processes of the banking sector of Ukraine at the present stage. Initially, the article highlights the main prerequisites for digital transformation of the domestic banking sector and the most dynamic trends in current process, which have become particularly active as a result of the COVID-19 pandemic. It is noted that Ukraine is actively developing digital instruments in banking according to world rankings, including the level of digital competitiveness and the level of contactless payments, and over the past five years there has been a steady improvement in Ukraine's position. First of all, the basic advantages and benefits of traditional banking institutions transition to digital sphere for both banks and their customers are summarized. Also, the number of banking branchs in Ukraine during 2016-2021 is studied and the main patterns in their dynamics are identified. In addition, the issues of banking chatbots, in particular the efficiency of their activities and areas of use in banking, as well as the list of the most active chatbots in the banking market are also thoroughly studied. Attention is also drawn to online banking applications and their importance for providing quality banking services, the main focus is made on the five best banking applications in 2021. Besides, the article focuses on Ukrainian neo-banks, first on the important differences in their work, basic characteristics and competitive advantages, as well as existing barriers for digital domestic banks. At last, an opinion on the role of FinTech in stimulating innovation and digitalization of the banking sector has been formed. The final point of the article is to outline future potential or already existing, but not yet very active trends and tendencies in the process of further digital transformation of both the global banking sector and the Ukrainian one in particular.