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It has been critical for banks to control all aspects of the value chain but now the information advantage is shifting towards the clients. It is no longer a pertinent strategy to focus on asset monopoly and wealth management for the privileged few – emerging new technologies have a democratising power which enable more and more people to take advantage of algorithmic financial services. Services that were previously only accessible to a limited number of financial-savy people in the world. Products across finance will have to place the customer at the heart of their business plan – and according to a recent survey by Accenture bank executives are in an evolutionary spirit; making steps to reimagine the landscape, rather than sit back and experience its disruption.

Last year, global investment in FinTech companies grew by 210% to $12.21bn (compared to $4.06bn in 2013) with the US taking the lion’s share and Europe experiencing the highest level of growth at 215% year-on-year.(1)

Major tech companies such as Google, Amazon, Apple, Facebook, Alibaba, Tencent and eBay are busy innovating in areas including payment solutions, point-of-sale, virtual currency, API’s, credit, PSP, B2B, B2C, API’s and algorhythm based banking. These popular global giants look threatening on the horizon and there can be no doubt of the heat the market is generating.

financial services


If we look at the market’s 1170 companies and their sectors we can see that Payments and Lending are by far the most popular areas of innovation.


How are banks reacting to FinTech? Well, a major concern was that traditional banks would be held back by legacy systems, regulations and cost reduction and lose out to new players that offer financial products and services in keeping with the digital age. However, banks seem to be acknowledging they have to evolve with a strategy of openness, collaboration and investment. Banks are increasingly creating new businesses within their own structures, open businesses that adapt and collaborate in this new era. Take for example, Goldman Sachs’ placement of it’s proprietary source code onto GitHub for optimisation or Credit Agricole’s launch of it’s open API – enabling developers to build expense management, finance analysis and social payment apps on top of its services. Some banks such as Citibank, Barclays and BBVA are acquiring FinTech companies – in our opinion the best way for banks to react to the FinTech explosion. Some like Santander and HSBC are setting up venture funds to fund and grow FinTech companies themselves.

banks reacting

In terms of collaboration we’ve witnessed the rise of the FinTech Innovation Lab Model which brings together banks and start-ups for collaboration and mentorship. There is also a hint towards cross-industry collaboration with mBank partnering with telco Orange Polska to create a joint white-labelled bank service for mobile phones and tablets. This spirit of collaboration with other industries is vital if the banks are to generate future value.

The future of fintech is by no means vertical, but horizontal. It’s about platforms, not mainframes, porous interfaces over monolithic surfaces. It’s about empowering consumers – not controlling them and not just big collective data but small personal data too. The landscape is set to be reimagined by digital technology to a highly democratising degree.



(1) Accenture
(2) The breakdown as follows: Payments (282), Lending (277), Personal Finance (136), Equity Financing (122), Retail Investments (99), Business Tools (83), Banking Infrastructure (68), Institutional Investments (63), Crowdfunding (54), Security/Auth/Fraud (54), Financial Research (35), FinTech Investors (34) and Consumer Banking (33). Interestingly, Small Business tools is the sector attracting the most funding (on average) with $76.98 followed by Lending ($65.68M), Payments ($49.47) and International Money Transfer ($37.33M) – Source: Venture Scanner