Template-Type: ReDIF-Paper 1.0
Author-Name: Chimwemwe Chipeta
Author-Name: Lerato Mapela 
Title: The effects of Basel III capital and liquidity requirements on the growth of banking functions performed by nonbank financial institutions and fintech platforms in South Africa
Abstract: We examine the effects of the implementation of the Basel III accord on the growth of non-bank financial institutions and fintech platforms in South Africa. Using a difference-in-difference estimation procedure, we find evidence of regulatory arbitrage, suggesting that the imposition of minimum capital requirements results in the growth of deposit-taking non-bank financial institutions. Our results are robust to alternative event windows and falsification tests. In contrast, country-level estimations show that tighter minimum capital restrictions constrain the growth of fintech platforms in South Africa, while innovation plays a crucial role in driving the growth and funding of fintech ventures in select African economies. Our results highlight the need for targeted policies that enable and sustain a vibrant fintech ecosystem.
Creation-Date: 2024-11-08
File-URL: https://www.resbank.co.za/content/dam/sarb/publications/working-papers/2024/the-effects-of-basel-III-capital-and-liquidity-requirements-on-the-growth-of-banking-functions-performed-by-non-bank-financial-institutions-and-fintech-platforms-in-south-africa.pdf
File-Format: application/pdf
File-Function: Revision
Number: 11070
Handle: RePEc:rbz:wpaper:11070