The economic essence of financial innovation and innovative transformation of financial services

Abstract

Aim. The presented study aims to reveal the economic essence of financial innovation and the specific features of its evolutionary growth, which correspond to the current and innovative developments in financial services.Tasks. The authors analyze and justify the transition from the concept of innovation to the concept of financial innovation from the scientific perspective; examine the evolutionary characteristics of financial innovation that correspond to the current development of financial services; develop a mechanism that facilitates the growth and spreading of financial innovation.Methods. This study is based on the analysis of works of reputable scientists and authors devoted to defining the concept of financial innovation, its characteristics, and stages of development.Results. The complex concept of financial innovation evolves with the development of science and technology. Scientists approach the concept of financial innovation differently, which leads to the lack of a single definition of this concept. Innovation plays a key role in the efficient functioning of the financial market and economic growth. The most important characteristics of financial innovation related to continuous development are identified. Several proposals are formulated to facilitate the growth and development of financial innovation while corresponding to the innovative transformation of financial services at the present time.Conclusions. A study of financial innovations and their various characteristics makes it possible to understand the impact of current technological developments on the traditional concept of financial innovation, limited only to the banking sector, in addition to identifying shortcomings that help to form a balanced mechanism that ensures the efficient growth of financial innovation.