Financial Innovations and Digitalization

  • Credits: 3
  • Ending: Examination
  • Range: 2C
  • Semester: summer
  • Year: 2
  • Faculty of Economics and Finance

Teachers

Included in study programs

Financial Markets and Investing

Teaching results

After studying this module, you should be able to:
Knowledge:
- know the concept of digitization, the processes associated with digitization and their impact on subjects in financial market
- understand the impact of digital technologies on changes in competition in financial services
- understand the basis of the functioning of digital currencies, their opportunities and threats to the monetary system
Competences:
- the ability to evaluate the positive and negative aspects of the impact of scientific and technical progress on financial markets
- assess the risks and opportunities of digitization and its impact on financial market processes and subjects
- apply theoretical knowledge in practical analyzes
Skills:
- adaptation to the labor market in areas that require rapid adaptation to new technologies in the field of financial markets
- analyze, explain and compare the development and practical use of digital currencies

Indicative content

1. Central bank digital currency – approach of entities, changes in central bank balance sheet, execution of monetary policy, intermediaries and exchange for other forms of money, interest rate of digital currency
2. Relation of central bank digital currency to the virtual currencies – the control over the money circulation, problem of international monetary system stability, safety
3. Problematics of cyberattacks, cyberespionage, cyber warfare, cybercrime, hacktivism
4. Digital strategies, the operational models and IT architecture in digitalized banking. Operational risks connected with the digitalization of the banking industry
5. Characteristics, advantages and disadvantages of crowdfunding, the most important crowdfunding platforms, principles and risks of shadow banking
6. Fintech in the payment system, their contributions, regulation and risks. Fintech in investing and their impact on financial markets. Automated trading systems.
7. Technological progress and changing nature of risks in society. Impact on insurance risks and reborn risks.
8. Impact of digital technologies on insurance value chain: development, design of product and pricing, product underwriting
9. Impact of digital technologies on insurance value chain: sale and distribution of insurance, servicing and assistence services
10. Impact of digital technologies on insurance value chain: insurance liquidation
11. InsurTechs and impact of digital technologies on competition in insurance. Innovations in insurance. Peer-to-peer insurance, sharing economy and insurance.

Support literature

1. Gross, M. & Siebenbrunner, Ch. (2019). Money Creation in Fiat and Digital Currency Systems. IMF Working Paper WP/19/285
2. Bordo, M. D. and Levin, A. T. (2017). Central Bank Digital Currency and the Future of Monetary Policy. National Bureau of Economic Research. NBER Working Paper 23711
3. Hackmageddon 2021. Information Security Timelines and Statistics.
4. Chen, M.A., Wu, Q., Yang, B. (2019). How Valuable is FinTech Innovation? The Review of
Financial Studies, 32(5), s. 2062-2106.
5. Lee, I., & Shin, Y. J. (2018). Fintech: Ecosystem, business models, investment decisions, and
challenges. Business Horizons, 61(1), s. 35–46.
6. Buchak, G., Matvos, G., Piskorski, T., Seru, A. (2018). Fintech, regulatory arbitrage, and the rise
of shadow banks. Journal of Financial Economics, 130, s. 453-483
7. Schmidt, Ch. 2018. Insurance in the Digital Age: A view on key implications for the economy and society. The Geneva Association.
8. Sigma. 2020. Data-driven insurance: ready for the next frontier?, SwissRe, 1/2020.
9. LIN, Lin; CHEN, Christopher. The promise and perils of InsurTech. Sing. J. Legal Stud., 2020, 115.
10. PwC. 2019. InsurTech innovation InsurTech’s.
11. Alt, R., Beck, R. & Smits, M.T. FinTech and the transformation of the financial industry. Electronic Markets 28, 235–243 (2018).

Requirements to complete the course

10 % activity during seminar
20 % presentation of project
70 % final test

Student workload

- 22 hours – seminar attendance
- 15 hours – preparation for seminars
- 15 hours – preparation of project
- 26 hours – preparation for final test

Date of approval: 09.02.2023

Date of the latest change: 28.12.2021