Nigel Green, founder and chief executive of deVere Group, one of the world’s largest independent financial advisory organisations, says the coronavirus pandemic has caused Fintech to surge and further disrupt the traditional banking sector.
His comments follow research that the use of financial apps is up by 72% since mid-March.
“The pandemic has accelerated those trends that were already shaping business. These include greater inclusion of tech into our every day lives,” Green observes.
Coronavirus has sped up digitalisation
He continues: “Coronavirus has ushered in a new world, with digitalisation and new technologies fuelling the changes. This can be seen by demand soaring for video-calling platforms such as Google Hangouts, Skype, FaceTime and Zoom amongst others, as more people than ever work remotely.
“It’s also underscored by the increasing use of Fintech apps which allow users immediate, on-the-go, 24/7 access to, use, and management of their money.”
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A historical precedent
Green suggests that there’s a historical precedent for what’s happening now.
“Banks and other traditional financial services providers were, in most cases, spectacularly caught off guard by the 2008-2009 financial crash.
“As they found their way into a new world with a new regulatory landscape and new customer expectations, business and tech developments were way down their to-do list. They were in survival mode.
“This is when agile, tech-driven challenger banks and Fintech firms swooped in to fill the void left between what traditional financial services companies, especially the traditional banks, were offering and what customers were expecting, especially in terms of customer experience.”
Financial services businesses are unprepared for technology disruption
Fintech firms are the new normal
Green points out that today, “Fintech firms, which offer mobile banking, savings and investment apps, and peer-to-peer lending, amongst other services, now have a decade of development, experience and expertise over many traditional banks.”
Due to coronavirus, and the imposed social distancing, people are now embracing Fintech solutions more than ever before.
“As people become ever-more tech-savvy, it’s likely that “bricks and mortar” banks will fall even further behind in market share and customer experience,” he says.
The deVere CEO concludes: “Coronavirus is going to further disrupt the wider banking sector. It will act as another catalyst for people to seek fintech alternatives to access, manage, use, save and invest their money across the world.”