The Effects of Electronic Payment Systems on the Performance of the Financial Sector in Selected Islamic Countries

Abstract

This study investigates the effect of electronic payment system on the performance of the financial sector in selected Islamic countries including Iran, Indonesia, Jordan, Kuwait, Malaysia, Egypt, Morocco, Oman, Saudi Arabia, Senegal, Turkey, and the United Arab Emirates. Reaching this purpose, the study uses annual panel data from 2011 until 2017. The results show that all electronic payment indicators including Mobile Bank, Internet Bank, Bank Card, POS machine and ATM positively and significantly affect the financial sector performance. It is also found that economic growth and population have a significant positive effect on financial sector performance. Inflation aKey Words: Electronic Payment Systems, Financial Sectornd interest rate negatively and sigThis study investigates the effect of electronic payment system on the performance of the financial sector in selected Islamic countries including Iran, Indonesia, Jordan, Kuwait, Malaysia, Egypt, Morocco, Oman, Saudi Arabia, Senegal, Turkey, and the United Arab Emirates. Reaching this purpose, the study uses annual panel data from 2011 until 2017. The results show that all electronic payment indicators including Mobile Bank, Internet Bank, Bank Card, POS machine and ATM positively and significantly affect the financial sector performance. It is also found that economic growth and population have a significant positive effect on financial sector performance. Inflation aKey Words: Electronic Payment Systems, Financial Sectornd interest rate negatively and significantly affect the financial sector performance.nificantly affect the financial sector performance.