Financial Technology and Digital Finance: Business Models and Risk Perspectives — a Comprehensive Review

Abstract

Financial technology (FinTech) has become a defining force in modern financial ecosystems, enabling new business models, transforming customer experiences, and challenging traditional financial institutions. Digital finance—powered by AI, blockchain, cloud computing, mobile platforms, and big data—has expanded financial access, improved efficiency, and driven innovation across payments, lending, wealth management, insurance, and capital markets. However, the rapid evolution of FinTech also introduces significant risks, including cybersecurity threats, algorithmic biases, regulatory gaps, operational vulnerabilities, and systemic risks from interconnected digital infrastructures. This review synthesizes findings from 25 scholarly sources to examine key FinTech business models and associated risks. A comparative table highlights major academic contributions. The analysis concludes that sustainable digital finance requires a balance of innovation, risk management, regulatory clarity, and strong governance frameworks.