Вы находитесь на странице: 1из 4


Since 2008 financial breakdown the financial services industries has realized the major drawbacks
of traditional way of functioning like traditional banking transactions and started shifting towards
adopting robust technologies for example big data, cyber security, blockchain technology and
fintech solutions which are revolutionizing the offerings of financial services to the customers in
the modern era of technological advances . The world is shifting more towards technology driven
and financial market is no exception.
FinTech is a collaboration of financial services and technology in which technology related starts-
ups and new market entrants come up with new products and services which is currently
provided by traditional financial services industry (pwc, 2016).
Fintech is defined as financial innovation which utilizes technology to create a new business
models, processes, and applications which drives the financial markets and institutions by
facilitating financial services (IAIS, 2017). The financial companies are aggressively investing on
developing new financial technologies according to (KPMG, 2017) the global investment in the
second quart of 2017 has doubled from $3.6 billion to $ 8.4 billion.
According to (Freedman, 2006) financial technology is all about developing systematic models by
utilizing price, time and credit to value the financial products such as stocks, bonds, currencies
etc. it comprises of secure communication which helps to exchange or send information such as
public or private quickly securely through built in financial systems and trading technology. The
financial industry is now experiencing a paradigm shift in offering the services to meet its
demands of customers needs by providing new user experiences. Financial Institutions are
rapidly adopting financial technologies which relies on creating a conducive atmosphere which
fosters the data collection and builds a strong relationship with clients.
FinTech Ecosystem

Source: pwc
Banking industry
Fintech is challenging the Banking sectors especially Fintech startups offering alternative loans
such as peer to peer lending, Robo-advisory platforms for asset management which is more
affordable and transparent. According to city bank in next 10 years 30% of the banking jobs will
be slashed, and Fintech as a potential to create a unique skill set jobs from todays bankers such
as data scientists rather than compliance officers (Arslanian, 2016). On the other side, the non-
banking Fintech firms solely focusing on payment services like fund intermediaries and merging
e-commerce and financial services with big data by creating new value-added services to the end
users. The regulatory and legal frameworks have been given more thrust to incorporate
finnovations which can handle cyber threats. Banks are now focused to improve the efficiency of
operations by creating a value-added solution such as adopting Application program interface
(API) which aims in integrating across various bank platforms and software-as-a-service (SaaS)
enables banks to offer a wider spectrum of options.
Financial Inclusion
According to (Nakaso, 2016) in the era of internet and smartphones FinTech has as a potential to
globalize the financial services and as a wide reach which can enhance financial inclusion
especially in the developing countries and emerging markets. The FinTech personalized tools has
a potential to analyze the customer perception which makes easier to deliver more personalized
services. The concept of virtual banking is becoming a reality without any physical infrastructure
just utilizing cloud services and artificial intelligence and with the help of smartphones the
investors it is possible to make smart investment decisions and manage risks. The FinTech
companies are developing a dynamic solution by giving more thrust to digital transactions which
enable money transfer on a real-time basis, user friendly digital wallets coupled with more robust
authentication and security.
Asset and Wealth Management
The FinTech firms are now using automation technologies to make asset allocations using
automated investment advice such as robo advisors which enables to serve high net worth
individuals to manage their assets which can considerably reduce the brokerage fee for Asset
under management (AuM). This might pose challenge to traditional mode of advisory services.
The blockchain can be used for post-trade settlement which uses distributed ledger technology
for reconciliation which augments and streamlines the current traditional process of asset and
wealth management (Courbe & Davis, 2017) .
Blockchain utilizes cryptographic, mathematical and economics theory to keep a database of
various participants in the absence of a third-party reconciliation and validation in the form of
secure and distributed ledger. The blockchain technology enables to enhance the business
processes by exchanging data among businesses that primarily have different commercial
objectives (pwc, 2016).
The Insurance Industry has been considered as conservative industry but technological
innovation is the key driver which is changing the Insurers business model. Insurers are becoming
more customer centric by adopting insurance technology (InsurTech) which enables the insurers
to develop new products and services and drive market innovations to meet the customer
demands. Insurance companies are heavily investing on mobile technologies and data analytics
to get a better insight of risk metrics and models to design better insurance products which suits
customer needs at affordable price.
Innovation is an ongoing process which depends on the organizations investments on R&D it all
depends on how the organizations leverage the technological opportunities like robotics, digital
ledger technology, cloud computing, artificial intelligence and create an ecosystem which can
add value to their products and deliver a superior customer services. In the coming days Fintech
has a great potential to change the financial sector the financial companies and regulators must
ensure that legal compliance and obligations are followed properly.
Arslanian, H., 2016. palgrave macmillan. [Online]
Available at: https://www.palgrave.com/gp/business-insights/fintechs-impact-on-the-future-of-banking
[Accessed 08 October 2017].

Courbe, J. & Davis, S., 2017. Beyond automated advice, s.l.: PwC's Global asset and wealth management.

Freedman, R. S., 2006. Introduction to Financial Technology. Elsevier.

IAIS, 2017. FinTech Developments in the Insurance Industry, s.l.: International Association of Insurance

Nakaso, H., 2016. FinTech- Its Impact on Finance, Economies and Central Banking. Tokyo, Bank of Japan.

pwc, 2016. Blurred lines: How FinTech is shaping Financial Services, s.l.: pwc Global FinTech Report.