Financial technology has come a long way as a result of blockchain tech and a series of emerging companies that are willing to take on the banking industry. A series of financial technology companies emerged in 2015-2018 such as Revolut, Venmo, N26 that are innovating and work more efficient than traditional banks, these disruptors are threatening large financial institutions.
There are a few banks fighting back by acquiring these non-banking organizations to use this technology for their own means. Only a few of the large banks have come forward to invest in this technology however.
The US fintech sector could become one of the largest new acquisitions in UK finance with over an estimated $4.3 billion in investment spent across the UK industry in fintech firms.
The biggest issue is that new financial technology is able to complete transactions faster and without all of the manpower that often required by larger banks to maintain their operations.
Competition is able to outpace the banks, offer lower fees and even offer better convenience. This represents a real threat for a financial institution that has been providing services over generations.
A series of small fintech companies or even generating sizable revenue from their regional banks. Keycorp for example is a small Ohio based regional bank that works at sourcing Fintech companies for investment.
Their ability to source the latest technology is helping banks in the UK to compete with the newest and most exciting challengers in fintech.
There are now comparison sites such for to help people choose the most convenient internet bank, best money transfer services or compare insurance quotes.
It will be interesting to see how future developments in technology change the way that people bank across the UK. The future of financial technology looks bright and it’s going to continue challenging large financial institutions until they are willing to embrace the same technology to lower fees and offer more value to their customers.