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?
On November 10, 2016, the UK and China announced a joint initiative to provide their domestic investors with new investment opportunities while further opening their respective markets to foreign capital. Named the London-Shanghai Stock Connect, it focuses on eight key areas and ultimately aims at easing cooperation and boosting market access. Those areas range from traditional sectors such as banking and asset management but also include socially important ones, for instance financial inclusion or green finance.
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.
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.
The alternative finance sector in France is experiencing great momentum. It’s the second largest market in Europe after the UK, with a volume that has more than doubled between 2013 and 2014 (+103%) and then again between 2014 and 2015 (+107%), reaching €319 million in the past year. France is also home to nearly half of the largest banks in Europe. The updated regulations, published in the Journal Officiel the 30th of October 2016, could be what is needed to allow the market to take off and reach the next level.
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%).”
Crowd Valley was invited to be part of the Middle East's largest technology conference, GITEX, in Dubai from 16-20 October 2016. Crowd Valley's CTO Paul Higgins attended alongside executives from Blockchain, PayPal, the US Department of Homeland Security and many other banks and funds looking to bring the latest innovations in fintech, cybersecurity and digital infrastructure to their financial services operations.
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.
The Emirates may have been less responsive than others to take action on the disruption happening with financial technology, but in the last year, along with the growing enthusiasm showed by the local environment of finance pioneers and investors, we have seen a good number of new initiatives that should catalyze the local digital finance market to scale.
Thomson Reuter’s Practical Law division published an article that provides a comprehensive review of the 60 crowdfunding offerings that were filed within the first two months of Regulation Crowdfunding becoming effective on May 16, 2016. This publication contains highlights and a more detailed analysis of a nascent, but promising sector.