The Risks of Using Financial Technology on the Jordanian Islamic Banking Sector

Abstract

The current study aimed to investigate the impact of the risks associated with the use of financial technology on the Islamic banking sector in Jordan. The researcher adopted a descriptive-analytical approach by referring to previous studies and scientific journals. The researcher developed a study tool, a questionnaire, that was tailored to the study's objectives. The study's population consisted of administrative employees in Islamic banks, numbering approximately 4,094 employees. The study sample was drawn from employees in the northern region of Jordan, with 218 questionnaires distributed and 206 questionnaires returned. After reviewing the questionnaires, it was found that 6 questionnaires were not valid for statistical analysis. Among the study's key findings, there was a statistically significant impact of the risks associated with various types of financial technology (lack of knowledge, operating systems, information security) at a significant level (α≤0.05) on the Islamic banking sector in Jordan. The results also indicated a good level of financial technology application in Islamic banks in Jordan. One of the main recommendations from the study is the necessity to develop banking regulatory and supervisory frameworks to keep pace with advancements in modern financial technology models. This can be achieved by utilizing regulatory technology and striking a balance between promoting competition and financial innovations, while ensuring the stability of the banking sector.