CTM and QFD analysis: Framework for fintech adoption priority in commercial banks

As financial technology (fintech) is developing rapidly, many commercial banks experience difficulty deciding what kind of fintech to primarily focus on when managing their business. Owing to limited resources and assets, there is a practical need for guidelines for banks' investments in fintech. This study provides a systemic procedure to identify promising fintech groups and their investment priorities. We propose a QFD-based decision support framework for banks by considering both aspects of the emerging fintech push identified using patent topic modeling and the market pull of banking services obtained from a survey of the literature and experts. An empirical application of the proposed QFD framework to major South Korean banks shows that transaction support technology, secure transactions, and trading platforms are the three most important fintech categories. The QFD results are utilized to guide individual banks for further investment strategies such as mergers and acquisitions, strategic partnerships, and spin-off operations. The proposed framework can be generalized and applied to other financial service firms.