FinTechs and the Financial Market Future

Adriano is a project manager in Sao Paulo, Brazil.

There is no reason to suggest that financial technology companies are a real threat to the future of large financial corporations. But how has FinTech driven the future of the financial sector—and how have traditional and established corporations responded to these threats?

FinTechs have already been running the market for a long time. What is so special now? To answer this, we need to think about the type of products and services being offered by these companies, which audiences they target and why they are causing financial institutions to lose sleep.

More than simply developing new systems or upgrading legacy systems for financial institutions, FinTechs began to develop and bring to market their own integrated applications and solutions to compete directly with them. They are things like mobile payment applications, resource transfers, credit card services and, in some cases, even the opening and maintenance of fully digital checking or savings accounts (which include services such as P2P loans, mortgages, financing, insurance, etc.).

In this model, the client no longer needs any physical interaction with the institution. And by offering their services—and a complete customer service environment—through the digital world without physical branches, FinTechs can provide their products and services at a fraction of the cost of traditional banking …

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"The whole problem with the world is that fools and fanatics are always so certain of themselves, but wiser people so full of doubts."

- Bertrand Russell

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