From Artificial Intelligence Capabilities to Financial Innovation in FinTech-Oriented Digital Ecosystems: The Mediating Role of Digital Entrepreneurship

Abstract

Artificial intelligence (AI) has become a strategic capability for enhancing innovation within FinTech-oriented digital ecosystems. However, the mechanisms through which AI capabilities are associated with financial innovation remain insufficiently understood. This study examines the relationship between AI capabilities and financial innovation by investigating the mediating role of digital entrepreneurship. Rather than if AI adoption automatically leads to financial innovation, the study proposes that digital entrepreneurship represents an important organizational mechanism through which AI-enabled analytics, automation, prediction, and intelligent decision-support capabilities are translated into innovation outcomes. A quantitative cross-sectional research design was employed, and data were collected from 159 respondents involved in technology-enabled business, entrepreneurial, and financial activities in Jordan. Partial least squares structural equation modeling (PLS-SEM) was used to evaluate both the measurement and structural models. The findings indicate that AI capabilities are positively associated with digital entrepreneurship, while digital entrepreneurship is positively associated with financial innovation. AI capabilities also demonstrate a smaller but statistically significant direct association with financial innovation. Furthermore, digital entrepreneurship partially mediates this relationship, highlighting its role in strengthening the translation of AI-enabled capabilities into innovation outcomes. These findings suggest that organizations achieve stronger financial innovation not merely through AI adoption but through their ability to combine AI capabilities with entrepreneurial opportunity recognition, digital experimentation, and commercialization activities. The study contributes to FinTech, artificial intelligence, and digital entrepreneurship literature by providing empirical evidence from an emerging digital economy and by demonstrating how entrepreneurial processes help explain the relationship between AI capabilities and financial innovation.