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Taking a Leaf Out of FinTech’s Digital Disruption Portfolio

Aug 30, 2017

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What your business can learn…and leverage from FinTech.

FinTech – it’s a pretty catchy name for a pretty simple concept; essentially, a business that aims to provide financial services using software and/or cutting-edge technology innovations. The Fintech experience is synonymous with digital disruption and the resulting digital transformation of the financial services economy. FinTech is massive and continues to boom. Not only is it expected to add A$1 billion new value to the Australia economy by 2020, PwC’s 2017 Global FinTech Survey tells that more than 80% or respondents believe their business is at risk of being lost to standalone FinTech companies within the next 5 years.

Add into this mix lots of buzz about other professional service industries headed now the same path – think insurance, mortgage broking, car sales and legal services.

So what’s propelling this disruptive wave?

Why after the initial flush, hasn’t the FinTech threat to incumbents dulled in the face of more robust media discussion around security, regulatory compliance, oversight and governance issues?

And what does FinTech offer that’s made other professional service industries fire up and want a piece of the action now too?

Well here’s the answer:

  • FinTech offers customers not only faster and more agile options, it gives them access to more financial service products they may not have been able to access before.
  • FinTech products and services are highly intuitive, truly data-driven and have been developed in a native AI and data analytics (and biometric-enabled) environments from the outset (not had analytics capabilities retrofitted to their business model)
  • They are truly customer centric by virtue of their reliance on app-based delivery to grow their reach. If it’s not easy enough, accessible enough, fast enough, or intuitive enough – it won’t succeed. Customer experience and design thinking are key.
  • FinTech knew it needed to build trust to propel its uptake, and has managed to garner trust almost organically by providing seamless user experiences, optimizing interactions with clients, promoting engagement across social media platforms, and most critically, by eliminating the perception of the dreaded “middleman” experience.

Speed, agility, intuitive technologies, data analytics, customer-centricity, and trust. All the key elements you see in high rotation on any digital disruption “how-to” slide deck or presentation. And even more interesting…it’s not even all about cost. It’s about winning, influencing and keeping new financial services customers through experience, utility, and access.

But the impact of FinTech is spreading well beyond the financial service industry. In the second-round of its value surge we see the potential FinTech can offers SMEs across all sectors.

Consider this – 95% of Australian start-ups FAIL and lack of capital is the key factor in this. The FinTech ecosystem offers start-ups and SMEs faster, new, alternative, possibly non-bank funding options and flexibility for cash flow and capital management.

FinTech offers SMEs access to improved e-commerce and payments systems, customer relationship management, and invoicing and collection features. This means faster transactions and differentiating customer experiences for your business. But the real pitch-hitter is that FinTech puts data directly into the hands of the SME, giving you the opportunity to capture and leverage granular, real-time data to support decision-making in the business, and enable continuous improvement and value-adding to offerings.

So as to why the FinTech disruption continues to surge? It comes down to this. For the financial service industry and beyond, FinTech is not about digitising money, it’s ultimately about monetising data. And that data has an economic potential that SMEs and our economy at large is only just now starting to uptap.

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