Myth or Truth?

June 20, 2021
Anjali Prasad

 

With the growth of the financial technology industry, many people will fear the end off traditional financial services services and the complete takeover of  automation in all areas of wealth and services management.

 

 

Fintech will End Banking

When spreadsheets became more common, people thought the need for accountants would cease to exist. When automation and AI came into play, people thought the need for human staff would drop to none. Digital transformations in the banking industry has  proven that people have heightened ease and reliability with non-traditional banking methods of  mortgage and financial services acquisition. However, banks around the world are not getting rid of bankers and brokers. As customers for online applications of financial services increase, the need for coexisting between these two forms of service will evolve. While fintech services allows for higher accuracy, faster efficiency, and simple transactions mitigated to different channels, the need for traditional banking will be required for moree complex transactions. Some customers prefer personalized service, as well face to face interaction and requirement  of in  person signatures and approvals.

Cyber Attacks will Increase with Fintech Industries…Not trustworthy

False. Despite the understanding that fintech industries deals with large sums of monetary transactions being transferred, increasing the incentive of theft by cybersecurity hackers and trespassers- Fintech companies make it a number one priority to invest in cyber security experts, highly confidential servers regulating security, and a large screen of regulatory framework designed to support the high volume of financial transactions.

Older Consumers will Prefer Traditional Banking and Lending

With the ease and simplicity  of applying for financial services and mortgages online, in a matter of minutes- with simple step by step infographics and videos, older generations are more inclined to take use of these services entirely online. While some customers do prefer a face-to face method transaction, many are opting for the ease and timeliness of online banking. 

While it is true that millennials in South Africa are 70% of the consumers of online financial banking services and taking loans, the US has only 15% of consumers under 30 using these services- More than 40% are around the age of  40 or older. This stark difference proves to be an opportunity to expand the market of financial solutions to be accessible for older generations. By G=gaining market share and expanding knowledge of the simplicity of use, it will be far more likely for the customer base to expand. 

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