Analysis of E-bank Innovation in China Using a Hypercube Model

Information and communication technologies innovating applications have posed technical, organizational and commercial challenges in financial industry. This study uses a hypercube model to investigate E-bank innovative changes in China and discuss their impacts on stakeholders: customers, banks, complementary providers and regulators. The results indicate that Internet bank (I-bank) differs substantially from telephone bank (Tele-bank) in technological components and business model. From Tele-bank to I-bank, innovation is radical to customers, banks and complementary providers, architectural regulators. However, From I-bank to Mobile bank (M-bank), innovation is architectural to customers and banks, modular to regulators, radical to complementary providers. We think that the innovation from Tele-bank to I-bank is not a simple supplement process. The changes will widely influence on the whole banking industry. The innovations from I-bank to M-bank, it is thought to be primarily a process of supplement rather than a process of substitute.