It’s no secret that markets gravitate toward greater efficiency with financial services being no different. As we often cover market segments ranging from peer to peer lending, wealth management / robo advisory and online syndication / crowdfunding marketplaces, the innovation emerging is multifaceted and rapid. It’s directed towards reducing friction and better overall service quality or user experience in financial services contexts. But what does this really mean - a future where software developers replace bankers as the architects of financial services?
With the recent implementation of the demonetization rules by the Government of India, a lot of interesting events have taken place in the day-to-day life of the Indian masses. With the largest denomination bank notes of Rs. 500 and Rs. 1,000 taken out of circulation, that accounted for about 86% of India’s cash circulation by value, people were forced to explore alternative routes like online banking and e-wallets as their cash alternatives.
Switzerland, one of the most important global financial centers and home to more than 250 banks, is actually a small of nation of 8 million people, that you may associate with world class chocolate, luxurious watches, the stunning scenery of the Alps and lakes, as well as excellent education infrastructure and unrivaled living standards. All these things and more, but probably not fintech. At least, not yet.
From Friday the 11th to 13th of November, Crowd Valley joined professionals from EY, Capital One, Addepar and CoVenture as well as students from institutions such as Cornell, NYU Stern and Columbia for Cornell’s annual Fintech Hackathon held at their Cornell Tech location in New York City. The focus of the event was to promote the innovation of applications and technology for two verticals: Financial Inclusion and Anti Money Laundering (AML). With $5000 in cash prizes, the event featured a large student turnout filled with exciting ideas to bring to fruition.
Anyone paying attention to the latest news from financial markets would agree that blockchain has been welcomed as the next “big thing” by many professionals due to the new opportunities it presents in terms of business scenarios.
As established financial institutions are becoming increasingly aware of the need to incorporate innovative technologies to their existing operations, the first signs of market consolidation are appearing within the financial technology services industry. According to Capgemini’s recent fintech report: “Almost as many traditional firms are developing their own in-house capabilities (59.2%), as many are seeking partnerships with fintechs (60%).”
London may still be the fintech capital of Europe but in the wake of Brexit and significant growth and development in its peer nations, the German fintech ecosystem is emerging as a major player in financial technology globally. While, for some time, the domestic fintech scene was not commonly known for its breathtaking speed of innovation, things are changing rapidly.
On October 18, 2016 the Malaysian Central Bank published its financial technology regulatory sandbox framework to enable the live experimentation of fintech solutions in the country. This initiative echoes the statement issued by the Indonesian Central Bank in late September: “Next month we will launch a fintech office [and] establish a special task force that will coordinate with other fintech offices". In this post, we will get an update on what's happened since they've been deployed.
Insurance has remained fundamentally unchanged for centuries. It has been described as one of the least trusted industry sectors with the lowest level of user satisfaction. Accordingly, to Daniel Schreiber, Lemonade CEO, the cause of this consumer unfriendliness is in the traditional structure of insurance: every dollar insurance company pays for their customers is directly taken away from their profits, which makes insurance company’s interest directly contrary to its customer’s interest.
Financial technology adoption has been incredibly fast in the most advanced economies, but it’s a totally different story for what concerns emerging countries, where the penetration of digital finance services is still very low. The good news for those economies, and for those looking to do business there, is that the potential growth is now extraordinary, thanks to the level of smartphone penetration.