Intelligent Fin.tech Issue 02 | Page 17

GAUGING THE MARKET

FINTECHS FOR GOOD : IS IT POSSIBLE ?

In recent years , there ’ s been a lot of discussions around whether FinTechs are good for the market . Mike Peplow , CEO at Paynetics , explores if FinTechs can truly be used as a force for good .

The 2008 recession caused many consumers to lose trust in traditional banks and , as we know , trust takes time to rebuild . 15 years on , it is still difficult for financial institutions to engage with customers and , as we teeter on the edge of another recession , this issue has become more pressing . FinTechs have led the way to re-engage with consumers , with banks learning from them . Both institutions have realised that forwardthinking financial products do more than just meet consumers ’ immediate needs .

An Accenture study found that twothirds ( 63 %) of consumers are looking to introduce more sustainable products and services across all aspects of their life , including their financial institutions . With consumers wanting a bank to do more than just look after their money , how will this affect FinTechs today ?
Defining a ‘ force for good ’ in FinTech
FinTechs have a few specific characteristics , including agility , ability to adapt , a focus on collaboration and an interest in challenging the status quo . FinTechs are often set up to focus on the individual instead of being ‘ one for all ’.
Consumers are more likely to buy financial products from providers who demonstrate sustainable values . Therefore , FinTechs that are ready and willing to demonstrate sustainable , ethical and purposeful products – with an end goal greater than just profit – will align with the consumers ’ wants and be more attractive to the current market .
Purpose-driven FinTechs
Putting purpose over profits requires FinTechs to have some social goal other than making money and being classed as a ‘ good ’ institution . This will put them in good stead as consumers are now actively looking for this purpose when choosing their financial institution .
At the same time , modern consumers value experience and wish for FinTechs to be more people-centric . FinTechs are often able to create a competitive advantage by tailoring offerings for niche markets . Consumers appreciate the personal approach and feel like their needs are being met . However , if another financial institution does this better , they won ’ t hesitate to switch providers .
FinTechs have caused banks to rethink their way of working . www . intelligentfin . tech
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