THE DEVELOPMENT OF DIGITAL BANKING IN UKRAINE IN THE CONTEXT OF FINANCIAL DIGITALIZATION

Abstract

The article examines the development of digital banking in Ukraine in the context of accelerated financial digitalization and the disruptions caused by the full-scale war. Firstly, it analyses the dynamics of cashless payments, the evolution of payment infrastructure, and the rapid expansion of mobile banking services, open banking solutions, and artificial intelligence technologies in financial operations. Furthermore, special attention is devoted to the strategic role of AI in credit scoring, real-time fraud detection, automated customer service, transactional analytics, and predictive modelling of financial risks. In addition, the study evaluates how digital innovations increase operational resilience, strengthen cybersecurity, promote financial inclusion, and ensure the continuity of banking services during periods of instability. Besides, it identifies the main drivers of digital transformation, including the growth of the fintech ecosystem, regulatory modernization, as well as shifts in consumer preferences toward digital-first financial behaviour. Also, the article highlights the impact of national digitalization initiatives, the implementation of European regulatory principles such as PSD2, and the gradual integration of Ukraine into the European open finance architecture. It demonstrates that the wartime environment accelerated the adoption of digital tools, turning mobile banking into a core financial interface for households and businesses. Furthermore, the analysis underscores the strategic importance of data-driven financial services for enhancing customer experience and ensuring long-term sectoral competitiveness. Moreover, the study reveals how technological innovation reshapes institutional practices and stimulates the emergence of new financial products. In conclusion, the findings confirm that Ukraine is moving toward an innovation-driven, data-centric financial model in which digital banking acts as a key enabler of market resilience, service efficiency, and long-term convergence with the European financial system.