FinTech? Don't You Mean FunTech?

When you think of fun, I'm sure the secure delivery of your financial data isn't the first thing that comes to mind - but why are the two mutually exclusive? Now that we’ve mastered accessing financial information through FinTech applications, we need to focus on the next generation of FinTech - Millennials and FinTech Disruptors:  a generation focused on the gamification and socialization of data.  

Companies - think Mint, Stripe, Swift, Venmo - are on a social mission. By improving user-engagement, organizational productivity and design, they have created an overall rewarding experience. Users find these apps not only useful, but a pleasurable experience by accomplishing tasks in a quick and fun way. These FinTech apps make it easy to forget that behind the innovative app in your smart phone is a traditional Financial Institution that powers it. 

Think about it - if you owe your friend money for a cab home, would you rather go through the hassle of finding a bank and depositing the $20 or use a mobile app that not only securely accesses your bank account, but allows you to personalize the payment process with pictures, messages and even direct links to your social media accounts?  By pressing a button on your smart  phone, you can now simultaneously update your Facebook status and pay your friend back, from anywhere in the world.  This shows technology is evolving, that people are evolving. As time and quality of life become higher priorities, these apps will empower users to be more productive, all while managing their finances.  

Of course, it's not all fun and games. These FinTech apps may act like a Financial Institution, access your most personal information and handle your money, but they are not regulated like a Financial Institution, that actually holds your assets. Security is also a concern, but then again is your Financial Institution providing access to your data in a secure way today?  In addition to hackers and security breaches, consumers need to worry as their personal data is constantly subjected to identify theft. FinTech apps mostly pull their data through screen scraping, a costly, unreliable method that puts the Financial Institutions and your information at risk.  However, some Financial Institutions are embracing technology and investing in advanced data aggregation and management platforms – think EEI’s Trusted Network™ - a clear indicator they value their client’s demands.

Financial Institutions have begun to notice that keeping up with this on-demand lifestyle is no easy feat. These Digital Natives, the epitome of the instant gratification culture, must be able to access and move their money while waiting on line at Starbucks. Financial Institutions have been ill-equipped to handle these expectations, allowing FinTech “disruptors” to swoop in and cater to the world’s largest generation: Millennials.  The financial sector is now at an inflection point and as competition increases and demand grows, we will see Financial Institutions either invest and adopt the modern FinTech culture or fall by the wayside. Regardless of your preference, one thing is for sure, “traditional banking” will never be the same again.

This is the first in a series of blogs I’ll be writing exploring the shift in technology and culture in the financial services industry. 

To read past blog posts click here.

Contact:

Jaimie Anzelone

115 Broadway Suite 1705

New York, NY 10006

janzelone@joineei.com | 212-344-2000