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Reint Gropp and Christoffer Kok

In this chapter the authors build on earlier work by Corvoisier and Gropp (2009) and examine the role of internet banking in retail banking competition. They focus on European banks for the period 2002–15. Building on the idea of contestable markets, they show that internet banking has overall increased competition through contestability of markets. The effect is stronger for retail deposits, but recently consumer loans have shown an effect. The authors attribute this finding to the advent of FinTechs. The findings support the use of non-concentration-based measures in banking in research.