Where a few years ago the banking and financial industry was steady as a rock, things can change rapidly. FinTechs are entering the market and let the traditional finance and banking industry shake on their grounds.
FinTech, referring to the overall definition of Financial Technology is used for start-ups, scale-ups and other companies who are using disruptive technology to change the way money is managed. Where the traditional finance industry is managed in traditional companies with a very unwieldy, inert and cumbrous IT infrastructure FinTechs will rule by flexibility, agility and disruption.
BI Intelligence divides the FinTech Ecosystem into six pillars, Payments & Transfers, Lending & Financing, Retail Banking, Financial Management, Insurance and Markets & Exchanges. As you can see FinTechs cover most of the traditional banking and finance value chain.
Very specific solutions in segmented markets is key. That is exactly what FinTechs makes hard to battle. They have very good ideas, products and services in a highly segmented market. Where FinTechs have more issues with the scale-up phase, the Financial Services industry have finds it difficult to be flexible and innovative. Questions which help you stay relevant for your customers can be:
- What channels are my customers using and how can I adept these in my offerings?
- How can new technology help my customer in money management?
- How can we make banking as easy as transferring money?
- How can we be innovative with products and services to enter new markets where my customer is moving to?
Bottom-line the message stays: FinTechs are taking over your market share financial industry, how are you reacting?