InvestorQ : I am a Fintech start-up and I want to understand how exactly are these Fintech companies actually disrupting the financial services business?
Crowny Pinto made post

I am a Fintech start-up and I want to understand how exactly are these Fintech companies actually disrupting the financial services business?

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1 year ago
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Today if you take any segment of the financial services business, there are FinTech ideas that are revolutionizing the traditional way of doing business. Look at banking. Actually, banking, the world over, is being changed by the rise of digital banking and deeply insightful credit decisions that are driven by pre-defined algorithms. The arena of investments is going through a shift with the increasing use of algorithmic trading which aids execution and machine learning which enables machines to think like humans. The area of financial advisory services and financial planning is being revolutionized by Robo Advisory, wherein robotic machines not only sift through mountains of data but also customize solutions to the unique needs of customers. Here are the trends you must be familiar with.

· The old model is changing and you need to work on how to marry the two models; the old and the new. FinTech start-ups are disrupting the traditional financial services model. Goldman Sachs used to have 600 traders at its global equities desk but now it has just 2 dealers. The rest of the job is done by automated machines. Over 30% of the Goldman Sachs employee count today consists of computer programmers. For the BFSI sector in India the choice is to adapt or become redundant. They either need to adopt the FinTech Model and incorporate it into their business. You are in a business that is disrupting in a big way so make the best of it.

· As a Fintech start-up, you can make the best of the old economy BFSI. There are some distinct advantages that old-economy BFSI companies bring to the table. Financial services sector is not just about technology and efficiency but about an in-depth understanding of the customer psychology and their spending and investment propensities. That is where years of customer insights of the BFSI companies will be useful for the start-ups. BFSI companies can bring in-depth insights and value into understanding the regulatory environment and the bureaucratic setup. After all, it is the BFSI companies that own the customer experience. FinTech start-ups bring to the table innovative ideas, technological expertise and a lateral way of looking at problems. Effectively, these start-ups represent the future direction which the BFSI industry.

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