FinTech has gone mainstream. Challengers have become mature service providers and incumbents now offer credible FinTech products.
This was one of the key themes of Ernst & Young’s Global FinTech Adoption Index. And consumers are onboard. The survey found that 64% of global consumers use a FinTech service and 96% are aware of at least one money transfer and payments service. While adoption rates are growing faster than expected, there’s still significant room for growth.
The battle lines between the disruptor and the disrupted continue to blur. Incumbents are embracing a new ecosystem approach. They are ramping up financial technology investment to improve operational efficiency, develop a broader range of customer-centric products, offer a differentiated experience and secure their share of the digital wallet. This investment is flowing both inwards and outwards as providers look to partnerships and outsourcing to accelerate the digital transformation of their business.
Financial services firms see security, compliance and data privacy risks as their greatest challenge in implementing a FinTech strategy, according to PwC.
As the new year unfolds, what else does the future hold? We’ve rounded up 14 FinTech statistics to give you a peak.
The path to FinTech integration
1. 48% of financial services firms have fully integrated FinTech into their operating model (PwC).
Technologies driving transformation
2. 62% of financial services CEOs believe that investment in emerging technologies is the top driver that will separate high-performing firms from the rest of the pack (Department for International Trade).
3. Two-thirds of UK financial services firms are using machine learning in some way (Bank of England).
4. 96% of insurance executives say the pace of innovation in their organisation has accelerated over the past three years due to emerging technologies (Accenture)
5. 87% of firms believe that demand for RegTech will increase over the two years and 50% report that firms in their sector have hired tech experts to modernise their business (Intertrust).
6. 56% of global financial services leaders believe artificial intelligence will create the biggest change in how financial services are delivered over the next two years (PwC).
7. 93% of insurance industry leaders have experimented with at least one DARQ technology – distributed ledger / blockchain, artificial intelligence, extended reality and quantum computing (Accenture).
8. 84% of insurance executives think that digital demographics are the way forward to drive growth by meeting unmet customer needs (Accenture)
9. 51% of insurers cite cyber and data regulation as a top challenge in adjusting to digital disruption (Deloitte)
10. 43% of retail banks do not have a cloud strategy or are only implementing basic practices (Accenture)
Job creation and skills shortages
11. 75% of financial services companies are creating FinTech jobs, but 42% of firms are struggling to fill these roles (PwC)
Adopting a new ecosystem
12. 82% of insurers, banks and investment managers plan to increase FinTech partnerships in the next three to five years and expect to see a 20% return on their innovation projects (PwC)
13. 49% of senior decision makers in financial services firms cite using qualified experts as one of the main reasons they use a third-party technology solution. (OnePoll / Asset Control)
14. 28% of these decision makers say that externally bundled data management solutions with complete service offerings (hosting, IT ops, business ops) is the first thing they look for as part of BPO deals (OnePoll / Asset Control)
How will these trends, opportunities and challenges impact your business? Are you prepared?