The Impact of Digital Transformation on The Competitiveness of Commercial Banks in Da Nang City

Abstract

The digital transformation of business models is no longer an option; instead, it has become an inevitable trend for banks to maintain their competitive advantage. To meet customer needs and stay caught up in the digital era, commercial banks in Da Nang City have been making efforts to digitally transform their products and services to build a system of advanced and modern digital banks, keeping pace with the general development trend of the world's banking system. The goal of the research is to examine the impact of digital transformation on the competitiveness of commercial banks in Da Nang City.

In this study, the author analyzed the digital transformation factors that affect commercial banks' competitiveness in Da Nang City, using data from 210 survey samples at commercial banks in Da Nang City in February 2024 and analyzed using SPSS 24.0 software. The proposed research model includes four factors: digital transformation, diversity of banking services, financial capacity, and risk. Through Exploratory Factor Analysis (EFA), the study has shown that digital transformation through E-banking and digital banking applications, as well as the rapid penetration of financial technology companies (Fintech), are essential factors that positively affect the competitiveness of commercial banks in Da Nang City. Research results show that in addition to digital transformation, financial capacity and diversity of banking services also positively affect banks' competitiveness, while risk is a factor that has a negative impact on it. From the results drawn, the author proposes some policy implications to improve the competitiveness of commercial banks in Da Nang city in the coming time.