7 Jul 2018
Will Fintech Reshape the Financial Sector ?
The new technological tools (using digital, “big data”, etc.) will alter production and distribution modes of financial services. These FinTech will deeply change both how the banking industry operates and how its structure evolves, especially as they will stimulate competition by paving the way for new stakeholders.
Given such trends, one may wonder whether traditional banks will be able to preserve their business model by adapting their products and processes, even if this means integrating innovative businesses or establishing cooperation with the latter in order to maintain their hold over customer services and relations. Conversely, one could predict that existing banks will become marginalised, either by specialised organizations or by the Internet giants (GAFA) who are able to capture the customer relationship, ever extending their business.
The prevailing scenario will more than likely condition the pattern of efficiency gains induced by the development of FinTech. What can we expect, a decrease in intermediation costs, better financial inclusion, or a reorientation of financing…?
Finally, FinTech pose new risks to financial stability: they could intensify interdependencies between organizations, increase operational risks or risks related to liquid assets, or even enable the relocation of risks outside the current regulatory perimeter… How should regulators and supervisors respond to this?
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