The evolution of FinTech in Europe and outside of Europe is a topic that’s been overly discussed in the past few months. Considering the continuous changes in the field of technology, staying up to date with the latest trends and the disrupting innovations that are in the center of attention at the moment is more like a must rather than an option. FinTech gathered everyone’s attention through the major changes it brings to the table. FinTech is a concept that’s worldwide known, but in some locations, its apparition stirred more interest compared to others. It is important to understand the impact of FinTech in well-developed countries and its impact in areas where accepting the concept happened slower.
The opinion of World Economic Forum covers all the factors that have been considered lately, and the specialists came to a relevant conclusion that has to do with the locations in which FinTech will develop the most in 2019. The different models of living in Europe encouraged the apparition and the development of FinTech in a more prolific way. Companies in CEE (Central and Eastern Europe) turned their attention to the digital revolution and started to adopt the long-expected innovations in terms of FinTech. This article will discuss these trends in an extensive manner, starting with the apparition of new payment solutions to SaaS innovations.
Payment solutions – say goodbye to paper money
Payment solutions are now more numerous than ever and the rise of cryptocurrency made people rapidly forget about paper money. Both companies and individuals started to prefer other methods of transferring and managing money instead of traditional banking. The goal of tomorrow’s payment solutions is to get rid of the strict regulations that traditional banking still involves. The European Parliament launched a second payment service directive which gives power to all businesses to use other payment solutions besides banks. More than that, the directive gives access to any third-party payment solution to accounts that are hosted by banks. This directive offered a clear road for the development of FinTech since it encourages the trend growth.
Besides new and more complex payment solutions, FinTech encourages another trend that has to do with cryptocurrency going mainstream. Even though cryptocurrency isn’t adopted massively, in all parts of the world, the trend started to become mainstream. Decentralized applications are going to be entirely focused on new ideas, new ecosystems, and new experiences. Cryptocurrency is the one that allows this sort of expansion, due to its characteristics. Even though the online environment is still not fully decentralized today, the society aims for this specific result in a few years from now on.
FinTech incumbents number grows considerably
Many people believe that FinTech only disrupts incumbents, when – in reality – FinTech could actually help start-ups evolve and establish themselves fully. 2019 is all about start-ups that use the benefits of technology in order to grow. Using FinTech for start-ups is oriented towards better cost control, allocating capital efficiently, increasing customer acquisition and so on. During the next year, is expected that the number of incumbents using FinTech will grow, especially for the businesses that desire to disintermediate their processes.
FinTech solutions are not currently trying to disrupt the actual business models, but to help start-ups evolve faster and achieve the expected results in an improved manner. The new range of benefits that FinTech provides could help any business improve its profitability, but when it comes to start-ups, its impact is even more visible. When the operations are based on FinTech from the very beginning, it’s easier to deal with the in-house technical concepts that make their apparition later.
Service aggregators
Entrepreneurs are lately focusing on a new type of ecosystem for micro-services. An aggregator business model applies a two-fold strategy for gaining and keeping customers. The only difference between this business model and others refers to the fact that in the case of service aggregators, both consumers and goods/service providers are treated the same. FinTech start-ups do not usually work with a lot of employees, meaning that the need for marketing is felt less, so the budget allocated to this sector is not considerable. The service aggregator ecosystem allows small FinTech companies to launch and increase their popularity on the market. Service aggregators could represent a game-changer for all businesses that want to evolve while using FinTech solutions.
Sharing economy
Financial services are entirely changed since the apparition of FinTech. In this sense, consumers are no longer oriented to traditional services and they are focusing their attention on sharing economy. Sharing economy was present in sectors such as transportation, hotels and so on, but 2019 expects a change in the way financial services are perceived. Airbnb and Uber are perfect examples of the adoption of the shared economy. This is, indeed, an innovation that disrupts financial services visibly. The following year brings a lot of opportunities for developing the sharing economy as a new, unique and flexible structure for financial services. The goal is to decentralize asset ownership and use the information tech to match the expectations of both providers and end users.
SaaS should go beyond the Cloud
The Cloud, along with Software as a Service together represent one of the factors that made the digital transformation possible. 2019 comes with another disruptive innovation that will entirely change the perception of businessmen. SaaS extended and transformed tremendously during the past year. The new approach that’s preferred by most start-ups refers to Platform as a Service, that goes beyond the Cloud. Any person who’s interested in this topic should learn more about the implications of FinTech solutions in running a business.
FinTech ecosystems represent the ideal use case for PaaS and SaaS. Even though banks and other institutions previously tried including SaaS and other cloud-based software models into their operations, the one environment that seems to work best with this approach is FinTech. Active server pages, enterprise resource planning, customer relationship management and all the other factors that made the apparition of SaaS possible. FinTech, on the other hand, drastically changed the way businesses can use financial services.