Since December 2014, The World Economic Forum has strived to understand the impact of potentially disruptive Fintech technology innovations on the financial services ecosystem. They have presented their findings in three phases.
Phase one ‘The Future of Financial Services’ discusses the potential of new innovative entrants, while phase two ‘The Future of Financial Infrastructure’ aims to illustrate the role of how financial infrastructure is going to enable the future of financial services. The third phase ‘Beyond Fintech’ is focussing on financial services sectors and areas that are slowly being reshaped by Fintech in a world where innovation technologies merge together.
Fintechs can be defined as small, technology-enablers, entering and disrupting the financial services sector. The main aim of their existence is to overtake the financial services market. Even though Fintechs failed to become a dominant player due to scale and customer adoption struggles, they have managed to change the competitive landscape of the sector.
First off, the wind of Fintech change gained tremendous strength in the payments, insurance, digital banking, lending, investment management, equity crowdfunding and market infrastructure. Additionally, Fintech is becoming the foundation for future disruption in multiple areas:
- Cost commoditization
- Profit redistribution
- Experience Ownership
- Data Monetization
- Bionic Workforce
- Systematically Tech Firms
- Financial Regionalization
The impacted areas and sectors illustrate the astonishing speed of Fintech innovation developments.
The last World Economic Forum report concludes how Fintech unleashes a new era of competition, innovation and job-creating productivity in the financial services sector. The original document can be found here.