“Yes, fintech is a threat to banks. It’s disturbing the industry – but for the better. It’s speeding up the banks so they need to adapt faster, and we need to run faster to stay around.”
Evelin Kaup of Nordnet said the question of whether fintech is a threat to banks is being discussed at nearly every industry event these days. So far, the fintech companies have said yes while the banks have been saying no. But that may be changing.
The threat from fintech companies is that they can offer what the banks’ customers want, but without all the code and baggage and without the bank licenses that necessitate all that messy regulatory compliance.
A Nordnet survey done some years ago found that one problem was that customers did not trust the banks or their advisors. So Nordnet partnered with a fintech company called Shareville, a digital social platform for active users with trading knowledge that they share with others to inspire those who are interested in trading but are not as experienced. Users don’t have to trust advisors or banks, just the other people on the platform whose portfolios are doing well.
So the bottom line is that yes, fintech is a threat to banks and is changing the industry, but for the better, because it’s making the banks adapt faster, Kaup said. Here’s how customers win because they benefit from the combined strengths of both types of company.