“Raqamli iqtisodiyot va sun’iy intellekt texnologiyalarining jamiyat rivojlanishidagi ahamiyati”
mavzusidagi xalqaro ilmiy-amaliy konferensiya 2024-yil 22-noyabr, Tоshkеnt, O‘zbekiston
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THE IMPACT OF DIGITAL TECHNOLOGIES ON FINANCIAL SERVICES
Shavkatov Abdusalim Shavkat o‘g‘li
Toshkent kimyo texnologiyalar instituti
Yangiyer filiali oʻqituvchisi
abdusalimshavkatov9@gmail.com
https://doi.org/10.5281/zenodo.14196885
Annotation: Digital technologies are becoming a new driving force in the global
economy. This study focuses on the role of digital technologies in the financial services
sector and examines their impact on the country’s economic stability. The research
analyzed economic data from the past seven years in the country, including key information
and communication technology (ICT) indicators used in various sectors of the economy
and the volume of financial services. The results indicate that digital technologies play an
essential role in expanding the scope of financial services, as the use of technology offers
limitless possibilities, providing advantages over human involvement in these processes.
Keywords: Digital technology, Financial services, Digital finance, Economic
activity, Data, Web portals.
Introduction
President Shavkat Mirziyoyev's "Digital Uzbekistan - 2030" strategy, unveiled on
October 5, 2020, prioritizes the digitalization of Uzbekistan’s economic sectors and
regions. This plan emphasizes the deployment of state information systems, the expansion
of electronic services, and the widespread adoption of digital technologies. The strategy
includes a range of initiatives targeting public education, state services, the judiciary,
finance, and banking.
Over recent years, digital technologies have had a transformative effect on financial
services in Uzbekistan. By incorporating digital tools, financial institutions have achieved
improvements in operational efficiency, service accessibility, and the overall customer
experience. As part of these digital transformation programs across regions and sectors,
over 400 information systems, electronic services, and other software applications have
been implemented to support socioeconomic development in various regionsificant
outcome of digitalization is enhanced convenience for customers. Digital technologies have
paved the way for online banking, mobile payments, and digital wallets, enabling customers
to access financial services on-demand from virtually any location. This shift has reduced
reliance on physical branches and minimized waiting times, thereby making financial
services available to a broader audience.
In addition, digital technologies have streamlined various financial processes through
automation. Tasks like account management, transaction handling, and risk analysis are
“Raqamli iqtisodiyot va sun’iy intellekt texnologiyalarining jamiyat rivojlanishidagi ahamiyati”
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now executed more efficiently using algorithms and artificial intelligence, which reduces
operational costs for financial institutions and mitigates human error.
Finally, digital technologies have also bolstered the security of financial transactions.
Advanced encryption and multi-factor authentication methods help secure customer
information and prevent fraud, thereby enhancing trust and confidence in the financial
system. This heightened security encourages greater engagement from individuals and
businesses in digital financial activities.
Literature review
This part analytically brings together the opinions of many researchers on this topic
that we are studying. Digital finance encompasses a range of novel financial products,
services, software, and modes of customer communication and interaction offered by
fintech companies and innovative financial service providers[2]. Digital finance
extensively combines digital technology and financial services, primarily characterized by
three key aspects. Firstly, it leverages artificial intelligence, big data, and cloud computing
to minimize transaction expenses, allowing individuals and businesses to access payment,
savings, and credit services without the need to physically visit bank branches or directly
engage with financial service providers[3]. Second, due to limited financial market
resources and discriminatory lending practices by traditional financial institutions, certain
companies face challenges in securing development funds at favorable interest rates [4].
Therefore, digital finance aims to cater to all segments of society, providing financial
services to businesses that may be marginalized by traditional financial institutions. Its
objective is to improve the accessibility and inclusivity of financial services, expand the
range of application scenarios, reduce the barriers to entry, and extend its reach to
underserved regions that lack traditional financial services. Thirdly, digital finance offers
various financial products, including savings, loans, and settlements, to both individuals
and businesses. With these characteristics, digital finance can play a crucial role in
supporting the transformation and advancement of companies.
Digital finance and social performance. The application of digital technology also
aids in reducing firm verification costs [5].
Digital finance and governance performance. One of the significant expenses
associated with corporate governance is agency costs, which arise from the separation of
ownership and control within contemporary companies [6].
In terms of residents' income and consumption, digital finance enables a broader
participation in the financial market. This has two main effects. Firstly, it provides
convenient payment methods that cater to the diverse consumption requirements of
residents [7]. In contrast, easily accessible financial services enhance residents' ability to
obtain credit resources. From a social development standpoint, digital finance can
effectively address issues related to employment, poverty, and energy consumption [8];
however, it is important to note that the digital divide can contribute to social inequality.
Scholars have also explored the connection between digital finance and economic
resilience, revealing that digitalization and the adoption of digital finance can enhance
economic resilience by generating substantial positive spatial spillover effects [9].
“Raqamli iqtisodiyot va sun’iy intellekt texnologiyalarining jamiyat rivojlanishidagi ahamiyati”
mavzusidagi xalqaro ilmiy-amaliy konferensiya 2024-yil 22-noyabr, Tоshkеnt, O‘zbekiston
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Theoretical mechanism and research hypothesis
This study draws on data from the Republic of Uzbekistan to create an empirical
model exploring the impact of digital technology adoption on the scale of financial services
across different economic sectors.
The research sample includes the volume of financial services provided across
Uzbekistan’s main economic activities from 2016 to 2022. Data for this analysis were
sourced from the official website of the Statistical Agency under the President of the
Republic of Uzbekistan [10].
Data analysis was conducted using STATA software, with Ordinary Least Squares
(OLS) regression serving as the primary method. Independent variables selected for the
analysis include various indicators of "Information and Communication" sector activity,
specifically the number of operating enterprises and organizations categorized by economic
activity type (as of January 1). This includes entities engaged in computer programming,
data storage and processing services, and web portals [11]. The dependent variable is
defined as the volume of financial activities, measured in billions of soums [12].
Table 1
Descriptive Statistics
Mean
Std. Dev.
Min
Max
Financial activities
7
36806.25
27971.983
9898.4
80849.1
Web portals
7
55
47.074
3
109
Data placement and~e
7
313
217.829
92
628
Computer programmi~s
7
619
317.969
370
1121
Source: Authors’ calculations. Frequ
ency:
Yearly
dat
a.
As shown in Table 1, the descriptive statistics reveal an average Financial activities value
of 36,806.25, with a standard deviation of 27,971.983. These figures suggest that the high
values can be attributed to the rapid expansion of financial services following the adoption
of digital technologies in various economic sectors. This shift represents a considerable
departure from previous years, resulting in high variability. Figure 1 further illustrates the
impact of digital technologies on financial service volumes, with a noticeable acceleration
in growth rates beginning in 2016.
Variable
Obs
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Figure 1. Source: Authors’ calculations
Results and discussion
The correlation analysis results in Table 2 indicate a strong positive relationship
among the variables chosen for this study, with all correlation coefficients exceeding 90%.
This suggests that an increase in one variable is associated with a corresponding increase
in the others, a relationship that is statistically significant, as all p-values are below 0.05.
Table 2
Pairwise correlations
Variables
(1)
(2)
(3)
(4)
(1) Financial_acti~s
1.000
(2) Web_portals
0.982
(0.003)
1.000
(3) Data_placement~n
0.991
0.988
1.000
(0.000)
(0.002)
(4) Computer_progr~t
0.993
0.978
0.975
1.000
(0.000)
(0.004)
(0.001)
Source: Authors’ calculations.
The regression analysis presented in Table 3 forms the core of this research. The R-
squared value of 1.000 indicates that the independent variables chosen account for 100%
of the variance in the dependent variable, which is statistically significant with a p-value
below 0.05 (Prob > F = 0.018). This implies that the growth in the volume of financial
activities in the current context strongly supports the need for broader implementation of
the selected digital technologies within the economic sector. Table 3
Linear regression
Y
Coef.
St.Err.
t-value p-value [95% Conf Interval]
Sig
X₁
187.845
61.1
-3.07
.02
-964.191
588.502
**
X₂
102.206
12.592
8.12
.038
-57.793
262.204
**
X₃
47.813
6.264
7.63
.032
-31.779
127.404
**
“Raqamli iqtisodiyot va sun’iy intellekt texnologiyalarining jamiyat rivojlanishidagi ahamiyati”
mavzusidagi xalqaro ilmiy-amaliy konferensiya 2024-yil 22-noyabr, Tоshkеnt, O‘zbekiston
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Constant
-
16598.045
1997.384
-8.31
.076
-
41977.212
8781.121
*
Mean dependent var
41162.740
SD dependent var
28908.429
R-squared
1.000
Number of obs
7
F-test
1669.071
Prob > F
0.018
Akaike crit. (AIC)
81.198
Bayesian crit. (BIC)
79.636
*** p<.01, ** p<.05, * p<.1
Source: Authors’ calculations.
Where:
Y = Financial activities (in bln. soums)
X₁ = Web portals (units)
X₂ = Data placement and processing services (units)
X₃ = Computer programming activities
The interaction among the variables is as follows: a one-unit increase in X1 leads to
an increase in Y by 187.845 units, while one-unit increases in X2 and X3 result in rises in
Y by 102.206 and 47.813 units, respectively. These effects are statistically significant, with
p-values below 0.05.
Conclusion and Suggestion
Based on the analysis above, we can conclude that an increase of one unit in Web
portals, Data placement and processing services, and Computer programming activities
results in an added value of 187, 102, and 47 units in the volume of Financial activities,
respectively.
The link between digital technologies and financial services is a well-established
topic, and this study re-evaluates the impact of digital technologies on regional economies.
Figure 1 illustrates how digital technologies have influenced financial activities, showing
a sharp increase in financial activity volume beginning in 2016, which aligns with the
broader adoption of digital innovations. It is important to note that our study initially
included a limited set of independent variables, while the current environment has seen a
significant rise in relevant variables, further contributing to the expansion of financial
activities.
Improved economic resilience allows economies to quickly regain previous growth
rates or redirect resources toward new growth pathways [13,14]. Previous research on
regional economic resilience has focused on measuring resilience and identifying
influencing factors. Economic resilience is typically assessed using commonly recognized
methods, such as comprehensive evaluation frameworks and sensitivity factors [15,16].
“Raqamli iqtisodiyot va sun’iy intellekt texnologiyalarining jamiyat rivojlanishidagi ahamiyati”
mavzusidagi xalqaro ilmiy-amaliy konferensiya 2024-yil 22-noyabr, Tоshkеnt, O‘zbekiston
99
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