FINTECH: A wake-up call for the entire industry


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Fintech and banking: Digitalization in the world of finance

Recently there seems to be a dominant concept which stands out from all the others when it comes to innovation in the financial sector. Fintech, or financial technology, is a concept that has evolved to the point that it has become one of the key elements in technology and innovation for an entire industry.

Digital transformation has gone from being a business trend to an actual need for any company and at any industry, businesses with a core on financial services are increasingly taking advantage of a digital transformation not only to adapt to the customer needs but also to benefit in productivity and performance to reduce overall cost. Every day FinTechs are having a more important impact on the financial industry as they become more attractive to a general public which traditionally would have remained closely linked to traditional banking.

The fact that FinTechs have undergone this exponential growth in the past years have brought a new figure into the scenario for this banking model, which previously was made up merely of large entities. With a new diverse, multijurisdictional, innovative and complete competitor, traditional banking is facing the challenges of a situation in which it has never before found itself.

Fintech as reinforcement for traditional banking

In the face of the wide range of investment solutions, society has become more receptive to finding alternatives to traditional financial management methods. In fact, consumer trusting FinTech products worldwide currently represent an important percentage of investors, causing a direct impact on traditional banking.

The financial crisis in 2008 directly affected some financial entities’ ability to generate trust among consumers. Thusly, people have become more drawn to the innovation and advances which allow them to research and invest in new ways through banks enabling them to reach their financial goals. Consequently, banks find themselves obliged to take the necessary measures required to face this situation, in some cases by acquiring assets and in others, by finding options which allow them to compete directly by opting for their own ability to innovate.

A linked future, combined forces to reach new goals

After completing the same analysis as every professional in the industry, many disagreements and contradictory opinions arise. However, the most defended idea is that of power unification. Instead of becoming an alternative, it is argued that FinTech should serve to empower innovation within the banking industry by diversifying services and progressing in a positive direction. This is something that has already been proven by those banks which have integrated digitization in their structure with solutions such as Tower by TechRules, and model Robo-Advisor solutions for end clients.

Digitization and technology are taking over every area and any attempt to resist the change that they imply isn’t usually the best solution. By means of specific tools and services, such as management and assessment platforms like My T-Advisor, creating a more agile process, reducing costs and increasing provided services allows for the possibility to regain consumer trust while paving the way towards a future in which the banking industry has adapted to society, innovation and all of the consumer needs.

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