Analysis Of the Problems of Digital Banking Regulation in The Modern Era

Abstract

The aim of this dissertation study is to analyze the current regulatory framework in the Republic of Azerbaijan and examine how users perceive the quality and effectiveness of the existing regulation in terms of risk management, personal data protection, consumer rights and trust in digital banking services. This research contributes in a novel way by merging an international theoretical approach on digital banking regulation with empirical evidence from Azerbaijani users, and by blending theoretical components into a legal, technological and institutional context. I chapter "Introduction" describes the importance of digital banking for the financial system of Azerbaijan, the research problem and gap, the aim, the research questions and hypothesis, as well as the object and subject of the research. Chapter 2 "Theoretical and Literature Review" analyzes public interest theory, risk- and principle-based regulation, institutional theory and technology acceptance models to explain digital banking regulation. It identifies particular gaps in domestic research surrounding legislative adaptation to fintech, supervisory capacity of digital banking, consumer protection, and open finance. Chapter 3, Data Analysis introduces a description of the research design and the survey instrument, a description of the sample of 118 users of digital banking services, descriptive statistics, reliability tests, and two multiple regression equations. The results reveal that the success of risk management from the user's viewpoint is dependent on legislation keeping pace with technology and state-bank compliance. Chapter IV, "Future Prospects of Regulation of Digital Banking in Azerbaijan", situates the findings for the context of Azerbaijan, and it examines challenges such as outdated and incomplete legal frameworks, insufficient transparency and consumer rights protection, and rising cybersecurity threats.