Fintech and Capital Markets Development and Integration in the CAREC Region

 IIA Working Paper No. 2024-01

Hee-Yul Chai (Kyonggi University), Minsoo Lee (Asian Development Bank), and Yeongseop Rhee (Seoul National University)

Capital markets development allows efficient mobilization of savings, effective risk management, and promotion of both foreign direct and portfolio investments. All these lead to better industry performance and economic growth. However, according to the financial market development indices developed by the IMF, the capital markets in most CAREC countries are underdeveloped. Capital markets development should be an important policy goal for the future economic prosperity of CAREC countries. Based on the criteria of feasibility and necessity, this report identified P2P lending and ECF, mobile trading, STOs, compliance automation, and customer relationship management as the service areas that CAREC should focus on in applying fintech solutions for capital markets development.