Information and communication technology (ICT) as a key determinant of performance in fintech firms: a study of China vs India

Purpose This study aims to investigate the determinants of efficiency and profitability among fintech firms in China and India, with a particular focus on macro-level information and communication technology (ICT) development as a key factor. Design/methodology/approach The study sample includes fintech firms from China and India. We apply instrumental variable techniques and the Arellano–Bond model to panel data from each country and compare the results. Findings The findings show substantial disparities between China and India. In China, a robust digital infrastructure has consistently enhanced fintech profitability and efficiency by facilitating customer acquisition and operational optimization. In contrast, India's fintech sector has yet to fully capitalize on the country's ICT growth. Practical implications These findings highlight that investing in technology alone is insufficient – it must be complemented by broader ecosystem development. In China, efforts should focus on managing costs while deepening innovation. In India, critical actions include addressing regional digital divides, improving service reliability and advancing digital inclusion to unlock the full potential of ICT for fintech performance. In both countries, mobile payment systems should be reviewed to identify opportunities for reducing costs and creating value. Originality/value This paper advances the fintech literature by empirically examining the impact of macro-level ICT development on fintech firm performance in China and India, moving beyond previous research focused predominantly on the micro level. Moreover, the study investigates the underlying mechanisms driving these associations, including scalability, customer acquisition and operational optimization. Building on previous research, we employ both static and dynamic econometric models to ensure robustness and methodological rigor, effectively capturing both cross-sectional and time-dependent effects. Furthermore, by analyzing the COVID-19 period, the study offers insights into fintech resilience and adaptability to external shocks.