In this study, we analyze the impact of ICT penetration on banking intermediation efficiency, as measured by interest spreads and interest margins. We use unbalanced panel data to explore how ICT usage affects the efficiency of financial intermediation after controlling for other macroeconomic determinants of spreads and margins. Highly statistically significant negative correlations between three ICT penetration indicators and both interest spreads and interest margins are identified by using

more »

... oth univariate and multivariate time effect models. Our results suggest that ICT penetration enhance banking intermediation efficiency by reducing interest spreads and margins.