What are some of the recent disruptive innovations happening in financial services?
By staying up-to-date with recent disruptive innovation, you will be able to successfully compete in this increasingly competitive market.
As the competitive landscape in banking and insurance continues to be shaped by large technology firms supplying critical technology to the financial sector, the door is being opened for these technology firms to provide substantial competition to large companies that provide financial services. According to a recent World Economic Forum report, though, fintech start-ups are falling short of their ambitions to upend the competitive landscape in finance. While fintech start-ups drive innovation, they fail to capture large market share. As fintech disruptive innovation continues to flood the market, how is this disruptive innovation affecting your business? Also, what recent disruptive innovation in financial services should you look out for?
As financial institutions strive to become more experience-driven, they open the door to potential competition from global technology giants. As this competition increases, banks and insurers struggle to carry out more core functions through technology. While fintech disruptive innovation is achieving success in terms of changing the basis for competition, it has had less impact than expected in disrupting the competitive landscape.
As the disruptive innovation model continues to develop and overtake financial services, cloud computing, customer-facing artificial intelligence, and big data will continue to evolve and not only drive more competition to the financial sector but also improve the way financial businesses provide customer satisfaction. Thanks to many companies offering technology to benefit the financial sector, more and more banks and insurers are turning to these technology firms to provide them with the cloud computing, customer-facing artificial intelligence, and big data functions they need to survive in this evolving landscape. Some of these technology firms include:
Amazon Web Services (AWS). This technology firm provides services to many financial companies including big names like Nasdaq and Capital One.
Brazil’s Banco Bradesco Facebook app. This technology firm allows customers to conduct day-to-day banking from their Facebook app. The company achieves this by relying on Facebook’s customer data analytics to target users.
Capital One and Liberty Mutual have also upped their game with their Alexa solution. With Alexa, a voice-activated personal assistant, these financial companies have made it possible for customers to check their account balances, pay bills, and even track their spending habits through the device.
These partnerships between financial companies and technology firms have accelerated innovation but they have also put large technology players who choose to enter the financial services sector at risk of being in direct competition with retail banks and insurers who have the money and means to outperform newcomers. Some financial companies have even responded to fintech firms by offering robo-advisers that provide automated investment advice to customers at low fees.
Now that you’re more aware of some of the recent disruptive innovation in financial services, how do you think these disruptions will affect your business? Keep up with the increasing competition in the financial sector by implementing cloud computing, customer-facing artificial intelligence, and big data in your firm. By keeping up with the latest disruptive innovation, you will be able to provide your customers with the best customer experiences while successfully competing in this increasingly competitive industry.