The rise of FinTech start-ups is going fast, taking up market share from the traditional banks. All because FinTech companies are able to work more efficiently, transparently, cheaper and more customer-focused. Big changes in the banking world are undeniable. The question is: will the traditional banks become redundant or will they be capable of reinventing themselves?
INVEST IN FINTECH
Velocity, ease of use and efficiency are the most essential aspects for the FinTech startups in which they outnumber the traditional banks by far. The technology driven startups decentralise the services of traditional banks and offer all the components separately via digital and mobile channels. This makes them competitive with very low rates. Thus making them very interesting for consumers and investors alike. A recent report by consultancy firm Accenture, stated that FinTech investments made between 2008 – 2011 tripled to about three billion dollars combined. Another 1,7 billion dollars was added in just the first quarter of 2014.
THE FUTURE IS NOW
The Economist stated in 2012 that ‘This is a time of huge opportunity in finance, as long as you are something other than a bank.’ The old-fashioned logistics, set-up and ways of working of traditional banks make them very unlikely to be ready for a big modernisation. Again, something the FinTech start-ups capitalise on.