Fintech should continue to dictate changes in the financial industry by focusing on emerging technologies offering a new customer experience, says the latest PwC Global Fintech Report 2017.
In its report, PwC identified the major trends that should shape the financial industry in 2018. Here is a small summary of these trends by business line:
Asset managers will invest in technology
Asset managers have not yet really benefited from the Fintech-generated disruption.
However, 41% of respondents in this sector think that their customers already do business with FinTech and 61% think that their clients could turn to a Fintech.
As a result, asset and wealth managers are starting to partner with FinTechs (30% of respondents created a partnership).
In the coming months, companies in this sector should invest in technologies that improve their operational efficiency and analytical capacity, in order to have a better decision-making process.
The retail bank remains the center of disruption
According to PwC, retail banking will still be the center of disruption for a few years.
More than 60% of respondents believe that the personal loan activity is threatened by the Fintech.
Ease of use, accessibility 7 days a week, 24 hours a day, and speed of service are aspects to solve to retain their customers.
For this, retail banks are forging more and more partnerships with FinTech (54% of respondents this year against 42% last year).
Currently, retail banks would be exploring new solutions to improve their operations, including blockchain.
Insurance companies form more and more partnerships
The companies of insurance intensify efforts to not be left behind by the Fintech.
Indeed, more than half of those surveyed continue to see the insurance industry as the second largest sector impacted by Fintech disruption.
The increasing sophistication of modeling to identify and quantify risks is the main trend of the moment and the one insurers are trying to address.
As a result, 84% of them are expected to partner with FinTechs over the next three years, compared to 45% in 2017 and 28% in 2016.
Payment companies will double their investment in the blockchain
A significant number of clients in the payments and remittances industry are already dealing with FinTechs.
More than 7 out of 10 companies in this sector (72%) concede that their business is threatened by the Fintech, although this figure is down (87% in 2016), reflecting the fact that payment companies are starting to see the Fintech as an opportunity rather than a threat.
Companies in the sector should invest in data analysis, mobility, and cybersecurity and especially in the blockchain.
Nine out of ten payment companies are expected to implement blockchain in their services by 2020.