Per the PwC Global FinTech Survey, financial services industry respondents fear that they might lose a quarter of their business or more to standalone FinTech companies within five years. FinTech companies, in turn, anticipate they could capture 33% of traditional financial service players’ business in the same time frame.
But in addition to posing a disruptive threat to their businesses, the majority of global banks, insurers and investment managers see FinTechs as potential partners. Most intend to increase their partnerships with FinTech companies over the next three to five years as the financial industry gets to grips with their innovation.
According to PwC, more than half of South African respondents (63%) are engaging in partnerships with Fintech companies, and 96% of those said they are expecting to increase partnerships over the next three to five years.
The past five years have produced significant examples of technology companies disrupting, and becoming totally dominant in their chosen industries. Examples include AirBnB (accommodation), Coursera (education), Netflix (Entertainment) and Uber (transport and food delivery).
There are numerous examples in the financial markets space as well, Capitec, Robinhood, and the disruption being caused to global financial services industry by Blockchain technology. More recently new exchange entrants stand to disrupt the 100+ year dominance of the Johannesburg Stock Exchange by positioning themselves as tech companies.
It certainly is feeling like a case of adapt or die.
Back to trends or view more trends below