Changes take time … until they suddenly seem to appear out of nowhere. Financial services are at the cusp of a remarkable change that few bankers realize. The decentralization of technology, new regulations, increasing competitiveness and ecosystem strategies – all these trends will mark the rise of a new era of finance services. This era will be fundamental to end-user value, and those who provide it will thrive.
Grow VC Group has prepared a report to cover the main changes and drivers in finance services. This includes especially FinTech services, which have impacted not only the whole finance industry, but also and on Internet services and business models.
This report covers much more than just the most predominant trends in financial services – it also discusses analogies of data to the oil business, and how new models miust truly spawn the rise of new ecosystems. We discuss the rise of financial institutions as safeguards of your money (as opposed to hiding money under your mattress), as well as their failings (where instead of a mattress, you have an offline wallet in a decentralized ledger system).
Some key questions considered in this report include:
- Are blockchain and crypto finance real things, or a bad bubble?
- Why will cloud-based solutions make banking IT obsolete?
- Why there are so many misleading ideas about AI and robotics in finance?
- Can banks survive disruption of the finance sector?
- Data is the new black gold, but what are the right models to utilize it?
No one has explicit answers, but this report offers new insights and angles to find answers. Finance services are a complex combination of services, instruments and technology. A lot of competence is required to develop new services, but it also requires challenging the old models and thinking.
The disruption of finance services is not driven by technology – it is driven by customer needs, and enabled by FinTech. Financial services as they stand today cannot truly meet customer expectations in the current and especially future era of global Internet and mobile connectivity. Financial services firms are also competing with a breadth of services, and they cannot expect to be key contenders in all of them. As startups and technology companies start to offer better services and really compete, the whole financial services industry must react.
The three key technology drivers are:
- Cloud based open API solutions
- Better data utilization, including AI
- Distributed solutions including different forms of blockchain.
Currently the real influence of these components is in the order above, although if you were to examine the public discussion, the order would seem to be the opposite. In reality, cloud-based services have already begun to significantly change finance services development and costs. Data analytics is already very important, whereas AI is more like a nice keyword.
Key transformations to be seen:
- Customer-centricity in offering design
- Cultural change in financial services firms
- Specialization of financial services functions and long-term positions.
The report covers many aspects of the ongoing disruption in finance and Internet services. It cannot cover all aspects, but it is one of the most comprehensive summaries of FinTech, distributed finance models, and finance data services. The report can help identify the key drivers and changes that will impact digital finance services and Internet services in the coming years.