FinTech Disruption: The Role of Digital Payment Systems in Traditional Banking

Abstract

The financial technology (FinTech) revolution has fundamentally transformed the landscape of traditional banking in the United States, with digital payment systems serving as the primary catalyst for this disruption. This study examines the multifaceted impact of FinTech innovations on conventional banking institutions, analyzing how digital payment platforms have reshaped customer expectations, operational frameworks, and competitive dynamics within the financial services sector. Through a comprehensive analysis of market trends, adoption patterns, and institutional responses, this research demonstrates that while FinTech presents significant challenges to traditional banking models, it also creates opportunities for innovation, enhanced financial inclusion, and improved service delivery. The findings suggest that successful adaptation requires strategic integration of digital payment technologies, regulatory compliance, and customer-centric service models.