The Evolution of Fintech-Driven Risk Management Strategies in Developing Economies

Abstract

This article examines how fintech driven innovation is reshaping risk management in developing economies, where digital finance, mobile money and platform-based lending are expanding rapidly against a backdrop of constrained regulatory and supervisory capacity. The main question is how these technologies affect credit, liquidity, operational and cyber risks, and under what conditions they support or undermine financial stability. The study uses a systematic literature review of peer reviewed research to consolidate dispersed evidence on fintech, financial inclusion and risk management. The results show a dual pattern: fintech tends to broaden access and diversify income sources, yet can amplify vulnerabilities when governance, consumer protection and supervisory frameworks lag behind innovation. The article discusses these dynamics through thematic analysis of institutional, technological and regulatory dimensions. The main findings highlight that fintech driven risk management is most effective where risk-based regulation, robust internal governance and upgraded data and analytics capabilities evolve in parallel with digital financial services.