Can Voluntary Insurance ensure risk-free digital-banking in Chinese-economy: seeking attentions?

ABSTRACT

In today’s business-world, services are carried out in a competitive manner country-wise such as China. Banking services are no different, which has resulted digital-banking. Bank Laws regulated by Central-Bank of China are characterized by evolving many factors that are often unpredictable. It faces serious pitfalls being it riskiness. Most cases, customers don’t read terms & conditions of services. Customers don’t save contract-copy. These weaknesses cause abuses. Customer faces perceived-risk. Dealing with challenges in Chinese-economy, application of Akim’s model - Voluntary Insurance (VI) can be impetus for policy-design, which can increase number of users. Welfare Analyses are used for guidance on setting insurance-price ensuring customer’s efficiency-cost so that the VI becomes appealing to parties involved. It can lead to higher number-of-users. In scenario, bank itself is an insurance-seller, the existence of adverse-selection is detected. Here estimated welfare-cost associated with inefficient-pricing created by adverse-selection is quantitatively small; however, advantageous-selection results opposite. Welfare assessment under alternative policy intervention in Chinese-economy will be vital for future-study.

KEYWORDS:

• On-the-go banking
• internet-banking
• mobile-banking
• perceived-risk
• adverse & advantageous selection in insurance market

Disclosure of potential conflicts of interest

No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

Akim M. Rahman

DR. AKIM MAHBUBUR RAHMAN is an economist. Born in Bangladesh, he has received his Ph.D. in Welfare Economics - Environmental Economics at the Ohio State University, USA. He is currently serving as Asst. Professor of Economics at the Canadian University of Bangladesh (CUB). Prior to teaching profession in Bangladesh, he was Researcher at Public Utilities Commission of Ohio, Ohio Department of Development and Ohio Dept of Education, State of Ohio, USA. He has 30 publications in different academic journals. He writes occasionally for local Newspapers in Bangladesh. He has authored three books: 1) Voluntary Insurance in Banking Services– New product for ensuring risk-free digital-banking of world-economy, published by Lambert Academic Publisher 2) Microeconomics – Basics: New Way Learning Microeconomics in the 21st Century Era 3) Mathematics for Business and Economics, where two of them are academic books.

Saadi Islam

SAADI ISLAM has completed Master of Business Administration degree from the Department of Management, University of Dhaka, Bangladesh. He has successfully completed his Master of Science degree and Bachelor of Science degree from the Department of Geography and Environment, University of Dhaka, Bangladesh. He has many publications in different academic journals. He has presented many papers in national and international conferences. He has research experiences in several projects. His major research areas are Environment, Disaster Management, Climate Change, Digital-banking, Economics, Cybercrime and Business.