The Mediating Role of Green Finance on the Relationship between Fintech Adoption and Banks’ Sustainability Performance

Abstract

The relationship between fintech adoption and Sri Lankan banks' sustainability performance is examined in this study, with a focus on the mediating function of green finance. The potential of fintech innovations to advance social and environmental sustainability has drawn more attention as they revolutionize the financial services industry. Simultaneously, green financial tools that assist ecologically conscious projects have become a key tool for sustainable development. Nevertheless, little is known about how fintech and green finance interact to impact banks' sustainability outcomes. This study employs a cross-sectional survey of 228 banking professionals from systemically important banks in Sri Lanka, grounded in the Resource-Based View (RBV) theory. The study demonstrates that fintech adoption significantly improves sustainability performance, with green finance serving as a partial mediator, using SPSS and Hayes' PROCESS macro. These findings suggest that fintech not only increases accessibility and operational efficiency but also helps banks better execute green financial practices. The findings support the strategic importance of green fintech in emerging economies by providing banking management with practical advice on how to match digital transformation with sustainable finance objectives. This study adds to the body of knowledge by evaluating bank performance in a developing nation context by combining environmental and technical factors.