Evaluation of Competition in the Banking Sector of the Republic of Moldova in the Conditions of Digitalization

Abstract

Technological advancements have significantly transformed the banking landscape, influencing competition and consumer behavior. Researchers explore the impact of innovations such as digital banking, mobile payments, and fintech solutions on the competitive landscape. They assess how banks leverage technology to enhance operational efficiency, customer experience, and product offerings, and examine the implications for market competition. Additionally, the entry of non-traditional players, such as fintech firms and tech giants, into the banking sector is analyzed in terms of its impact on traditional banks' competitiveness. Competition in the banking sector influences access to financial services, particularly for underserved populations or regions. Researchers examine how competition drives innovation and expands the availability of financial products and services. They assess the impact of competition on pricing, fees, and the overall affordability of financial services, as well as its implications for financial inclusion and economic development. The purpose of the article is to analyze and understand the competitive dynamics within Moldova’s banking industry. To achieve this goal, we underline the following objectives: to analyze the level of concentration and market structure within Moldova’s banking sector to understand the competitive landscape; to investigate the factors influencing competition, such as regulatory frameworks, technological innovation, and market conduct, to identify key drivers of competitiveness; to investigate the impact of digitization on competition within the banking sector, analyzing how technological advancements influence competitive dynamics. Competition in the banking sector directly affects consumers by influencing the availability, affordability, and quality of banking products and services. Researching competition can help evaluate the impact of competitive forces on consumer welfare, including access to financial services, pricing, and innovation, thereby informing policies aimed at protecting consumer interests. The article was developed within the framework of Subprogram 030101 „Strengthening the resilience, competitiveness, and sustainability of the economy of the Republic of Moldova in the context of the accession process to the European Union”, institutional funding. UDC: 339.137.2:336.71(478); JEL: G21, K42, O33.