Gone are the days when fintech and banks were seen competing against each other. No longer do we see gloom doom statements questioning the stability or existence of either of these entities. The new norm is to co-exist and flourish, enhancing customer loyalty and longevity.
Today, almost all leading banks have set up incubators, innovation labs, venture funds or accelerators to encourage fintech startups to collaborate and work with the big daddies. The banks have realized that burdened as they are with their legacy IT systems, regulatory controls and size, they still need to address changing consumer preferences. And digital is one area, where the consumer demands have been escalating every day.
Here are three areas where consumer needs have been effectively addressed by fintech, ensuring that consumer requirements serve as huge motivation to innovate and solve.
Hassle-free loan processing
Once upon a time, when a person needed a loan, he had to jump through multiple hoops – meet the loan agent, source documents, wait and pray. Thankfully these are tales of yore now. Fintech firms have made it possible to process loan applications with very little hassles.
A good example here is FormFree, a company that through its product AccountChek provides automated verification of income and assets to all lenders in few minutes. This helps both the lender and the borrower, reducing costs for one and bringing down the burden for the other. There are more examples of similar companies using cloud based platforms to ensure that the processing of loans, credit cards or insurance are automated significantly.
This also an area where online financial marketplaces, like BankBazaar, have simplified the process for potential borrowers. We ensure faster, online approvals for various products, having streamlined and collected customer information through our site.
And then there is the burgeoning P2P industry. Fintech firms like MoolahSense, Funding Societies, and Crowdo, also address the need for smaller loans, ensuring the borrower meets the lender directly.
While fintech firms have clearly led from the front here, bigger banks are now trying to bridge this gap on their own or through fintech collaborations as well. Wells Fargo moved to the online lending marketplace with its product FastFlex loan, while JP Morgan entered into a partnership with OnDeck Capital.
If you have been living on this planet, then it is unlikely that you’ve not been hit by terms like blockchain and bitcoins. The world of finance around us is changing! Some of the success stories here are that of Digital Asset Holdings and Kensho, where the technology is being used effectively on the Wall Street.
Although still in early stages of implementing this technology, many startups are taking the lead here in Singapore. Among them is CoinPip, a payments company that leverages the bitcoin blockchain to allow global money transfers. The company targets freelancers and migrant workers.
Not to be left out, the big banks here are now part of a pilot project with the Monetary Authority of Singapore to use the blockchain technology for interbank payments, including cross-border foreign currency transactions. Eight local and foreign banks will work with the country’s stock exchange to explore the use of this technology for the very first time. And this is just one the many payment revolutions that are likely to shape economies going ahead.
Digital businesses have practically transformed our lifestyles. Be it ordering monthly groceries, hailing a taxi, home-delivering food, shopping for clothes or searching for homes — everything is now online. So why not our banks?
True, some transactions have moved online, but long queues at bank branches indicate that there is a huge potential to do more. And this is where fintech firms picked up the baton. Online only banks across the globe are making transactions seamless and hassle-free, cutting down huge costs and delivering exceptional services. Vietnam’s Timo, is one that has moved to this new stage of internet banking. Timo, stands for Time and Money, and sure enough, is doing all it can to save both for its consumers.
Here again, banks like DBS have tried to offer unique digital services like its mobile-only bank, digibank for India. Digibank uses biometrics and Artificial Intelligence to service their customers in this market.
The banking industry that is so core to the economy is seeing massive changes in the way it works and delivers. Discerning customers are demanding more from the entities, products and services. A lot has changed and a lot more promises to transform. We sure live in interesting times!
BankBazaar.sg is a leading online marketplace in Singapore that helps consumers compare and apply for the best offers across all financial products: personal loans, home loans, credit cards & investments.