The Rise of the FinTech and its Effect on Traditional Banks

By: Yinka Adedeji, Head of Consumer & Digital Banking at UBA Plc. 

Banking is traditionally thought of as an mediator between those that have excess money and those that need money. Banks are still stuck with the traditional mind-set by continuously re-inventing around liability, credits, treasury and correspondence products.
Managing these products requires a lot of manpower. Manpower required to assess small value requests is the same as what is required to assess large value requests. For example, the effort to process a mortgage of Euro 25,000 is the same effort to process a 250,000 Euro mortgage. At the same interest rate, the larger ticket transaction will yield higher interest income. Therefore, traditional banks usually focus on those large ticket opportunities. 
Technology entrepreneurs have identified these opportunities in low value ticket but high velocity transactions and have come up with fantastic solutions. These financial technology entrepreneurs are now emerging so fast with very simple and easy to use solutions for customers that need financial services that traditional banks do not place a lot of value on.

The threat posed by UBER to the transportation industry is child's play in comparison to what FinTechs can do to traditional banks.
The advantages of FinTechs over traditional banks are agility, idea generation at the back of envelops, decision making in coffee shops instead of fancy boardrooms and lengthy unproductive meetings, flexibility to continuous change, openness to use shared services like clouds, very low cost and low pricing, no legacy systems to box their thinking, no fear of failure and, freedom from claws of regulators.
Fintechs are dominated by students, new graduates and experienced workers who are frustrated with the products and processes of traditional banks. However, some giant social media agencies such as Facebook, Google, Yahoo, WhatsApp, etc. are now playing in the payment space of traditional banks. They are not only driving banking service penetration but also bridging the gap between  banks and Fintechs to provide financial services. Tech giants are gaining the trust of people, and, in fact, have more information about the customers and their friends and family than what the banks have.  Thus, the banks no longer monopolize peoples’ trust.

However, traditional banks also have a unique advantage in the sense that people trust that their money is safe.

The advantages listed for FinTechs are the disadvantages of traditional banks and the advantages of traditional banks are the disadvantages of the FinTechs.

Central switches have improved significantly as FinTechs can now readily connect to banks. The switches that rely on account numbers will definitely require the banks to authenticate all transactions and will require collaboration of the banks. However, those switches that accept cards have opened the capability of Fintechs to approval debit/payment transactions from accounts that are in banks.
FinTechs are introducing new and cool products such as account deposits, payments and transfers, recurring payment services, bill payments, local and international remittances, nano- and micro- loans, discounts, loyalty services, etc.

Traditional banks are trying to respond to the threat posed by these FinTechs barbarians at the gate. However, traditional banks cannot respond with better solutions fast enough.
The banks have come to recognize that they have to collaborate with Fintechs in a Win Win style.

Traditional banks will enable and provide access to already banked customers current and historical data and Fintechs can access bank data at a cost.
When the dust settles, traditional banks will enable, acquire or invest in some Fintechs. Traditional banks will need to improve to act like Fintechs or die.


Share on Google Plus

About Lion King

11 comments:

  1. These financial technology entrepreneurs are now emerging so fast with very simple and easy to use solutions for customers that need financial services that traditional banks do not place a lot of value on. AZ-100 dumps

    ReplyDelete
  2. Thanks for post! I also recommend you to get acquainted with this one. Have a nice day!

    ReplyDelete
  3. คาสิโนออนไลน์ที่น่าเชื่อถือและมีความเป็นมืออาชีพที่สุดในตอนนี้
    โปรโมชั่นGclub ของทางทีมงานตอนนี้แจกฟรีโบนัส 50%
    เพียงแค่คุณสมัคร สล็อตออนไลน์ กับทางทีมงานของเราเพียงเท่านั้น
    ร่วมมาเป็นส่วนหนึ่งกับเว็บไซต์คาสิโนออนไลน์ของเราได้เลยค่ะ
    สมัครสล็อตออนไลน์ >>> Goldenslot
    สนใจร่วมสนุกกับ คาสิโนออนไลน์ คลิ๊กได้เลย
    มีทั้งคาสิโนออนไลน์ หวยออนไลน์ ฟุตบอลออนไลน์ สล็อตออนไลน์ และอื่นๆอีกมากมาย

    ReplyDelete
  4. PLEASE READ!!Hello Guys! I am Ruth I live in Ohio USA I’m 37 Years old, am so happy I got my blank ATM card from Adriano. My blank ATM card can withdraw $4,500 daily. I got it from Him last week and now I have withdrawn about $15,000 for free. The blank ATM withdraws money from any ATM machines and there is no name on it because it is blank just your PIN will be on it, it is not traceable and now I have money for business, shopping and enough money for me and my family to live on.I am really glad and happy i met Adriano because I met Five persons before him and they could not help me. But am happy now Adriano sent the card through DHL and I got it in two days. Get your own card from him right now, he is giving it out for small fee to help people even if it is illegal but it helps a lot and no one ever gets caught or traced. I’m happy and grateful to Adriano because he changed my story all of a sudden. The card works in all countries that is the good news Adriano’s email address is adrianohackers01@gmail.com

    ReplyDelete
  5. PLEASE READ!!Hello Guys!!! I am Caro I live in Ohio USA I’m 32 Years old, am so happy I got my blank ATM card from Adriano. My blank ATM card can withdraw $4,000 daily. I got it from Him last week and now I have withdrawn about $10,000 for free. The blank ATM withdraws money from any ATM machines and there is no name on it because it is blank just your PIN will be on it, it is not traceable and now I have money for business, shopping and enough money for me and my family to live on.I am really glad and happy i met Adriano because I met Five persons before him and they could not help me. But am happy now Adriano sent the card through DHL and I got it in two days. Get your own card from him right now, he is giving it out for small fee to help people even if it is illegal but it helps a lot and no one ever gets caught or traced. I’m happy and grateful to Adriano because he changed my story all of a sudden. The card works in all countries that is the good news Adriano's email address is adrianohackers01@gmail.com

    ReplyDelete
  6. PLEASE READ!!Hello Guys!!! I am Caro I live in Ohio USA I’m 32 Years old, am so happy I got my blank ATM card from Adriano. My blank ATM card can withdraw $4,000 daily. I got it from Him last week and now I have withdrawn about $10,000 for free. The blank ATM withdraws money from any ATM machines and there is no name on it because it is blank just your PIN will be on it, it is not traceable and now I have money for business, shopping and enough money for me and my family to live on.I am really glad and happy i met Adriano because I met Five persons before him and they could not help me. But am happy now Adriano sent the card through DHL and I got it in two days. Get your own card from him right now, he is giving it out for small fee to help people even if it is illegal but it helps a lot and no one ever gets caught or traced. I’m happy and grateful to Adriano because he changed my story all of a sudden. The card works in all countries that is the good news Adriano's email address is adrianohackers01@gmail.com

    ReplyDelete
  7. PLEASE READ!!Hello Guys!!! I am Caro I live in Ohio USA I’m 32 Years old, am so happy I got my blank ATM card from Adriano. My blank ATM card can withdraw $4,000 daily. I got it from Him last week and now I have withdrawn about $10,000 for free. The blank ATM withdraws money from any ATM machines and there is no name on it because it is blank just your PIN will be on it, it is not traceable and now I have money for business, shopping and enough money for me and my family to live on.I am really glad and happy i met Adriano because I met Five persons before him and they could not help me. But am happy now Adriano sent the card through DHL and I got it in two days. Get your own card from him right now, he is giving it out for small fee to help people even if it is illegal but it helps a lot and no one ever gets caught or traced. I’m happy and grateful to Adriano because he changed my story all of a sudden. The card works in all countries that is the good news Adriano's email address is adrianohackers01@gmail.com

    ReplyDelete
  8. PLEASE READ!!Hello Guys!!! I am Caro I live in Ohio USA I’m 32 Years old, am so happy I got my blank ATM card from Adriano. My blank ATM card can withdraw $4,000 daily. I got it from Him last week and now I have withdrawn about $10,000 for free. The blank ATM withdraws money from any ATM machines and there is no name on it because it is blank just your PIN will be on it, it is not traceable and now I have money for business, shopping and enough money for me and my family to live on.I am really glad and happy i met Adriano because I met Five persons before him and they could not help me. But am happy now Adriano sent the card through DHL and I got it in two days. Get your own card from him right now, he is giving it out for small fee to help people even if it is illegal but it helps a lot and no one ever gets caught or traced. I’m happy and grateful to Adriano because he changed my story all of a sudden. The card works in all countries that is the good news Adriano's email address is adrianohackers01@gmail.com

    ReplyDelete
  9. "DO YOU KNOW THAT YOU CAN HACK AN ATM MACHINE WITH  PROGRAMMED BLANK ATM CARD?? This card is an ATM cards that can be used to hack into any ATM machine. Withdraw as much cash as you want!! We sell this cards to buyers worldwide. We also make credit cards too! Here is our list for ATM cards:
    $10————-$10,000
    $10 ————$20,000
    $10 ————$30,000
    $10 ————$40,000

    Those cards are programed to withdraw for 3 months before you can renew it, if you want to get your own card Contact us on Email: adrianohackers01@gmail.com"

    ReplyDelete
  10. My wife was putting up some attitude and acting strange,and we have been married for eight years,I explained my problems to my friend and he recommended brillianthackers800@gmail.com,I sent him a mail explaining my situation to him and he helped me hack into her phone,Walt sent me a WhatsApp conversation between my wife and her concubine which she told him everything about me and our marriage and he also recorded a call conversation between she and her concubine talking about how they were going to kill me and take my money and properties,I took this to court and I won the case,they were locked up in prison all thanks to Walt who saved my life through his hacking experience,every dollar I spent on this job was worth it,message him and he will help you with your problems.

    ReplyDelete
  11. Grand spécialiste du retour affectif rapide de l'être aimé

    Mes services
    Grand maître des sorciers vaudou voyant medium et guérisseur africain est spécialiste des problème affectif 36 ans d'expérience aux dons de père en fils depuis plusieurs génération .
    Le grand maître des sorciers vaudou intervient dans les domaines suivants :
    Retour d'affection
    crise conjugal
    problème familiale
    desenvoutement
    protection contre tout mauvais sort ou dangers
    union rapide
    attirance des femme ou des hommes
    attirance de clientèle pour les vendeurs et les entreprises
    Devenir riche en quelque jour
    fidélité absolue entre époux
    impuissance sexuelle
    chance aux jeux
    problème de voisinage
    amour perdu
    angoisse
    abandon de tabac et d'alcool
    . Rituels pour tomber enceinte rapidement

    CONTACT MAITRE DOSSOU
    E-mail personnel : dahvaudounon@live.fr
    Tel / whatsapp : +229 68 60 11 72
    Site web: https://www.medium-voyant-retour-affectif.com/

    ReplyDelete