FinTech Impact on Retail Banking – From a Universal Banking Model to Banking Verticalization

The digital disruption tide has arrived to hit the banking and financial services industry. This is not just a major technological change, or an addition of new channels, this is a profound overhaul of the whole retail banking model as the entire market structure will change. New digital competition has developed, under the label of FinTech. Robo-advisory platforms are becoming more visible. Cross-border trade finance, payments tools, and networks need to be developed to enable the digitization of financial services. Big data and new analytics capabilities are needed to extract value and personalize the customer segmentation and service in all unbundled segments. This is creating an extraordinary development of new software capabilities across the board that will impact the whole financial sector. Banks and big tech giants may decide to expand internationally not via a universal bank model but by selecting the most efficient and streamlined vertical services.