On May 21, 2014, the Finance 2.0 conference held in Zurich was again attended by bankers as well as Swiss and German FinTechs to discuss current developments in the digitalization of financial services. In addition to interesting presentations, there were animated discussions both on and off the panel. The topics covered ranged from security threats to innovation in digital financial services and Banking 2020. The papers presented are accessible at www.finance20.ch.
Various trends emerge from current innovations.
On the one hand, most new digital applications primarily relate to banking services. Insurance companies still take their time in digitalization or, to quote a panel discussion, “If you believe that banks are slow, you should have a look at insurance companies.” Digital banking services currently focus on more self-directing for investments, financing and increasingly on getting advice. In addition, peer-to-peer and crowd financial services are increasing, for example, for funding specific projects. Services with social media components, e.g. following and replicating the trading strategies of successful traders, also fall into that category. Representatives of various companies presented their applications and answered questions from the audience.
The topic of Banking 2020 revealed the diverging views of bankers and FinTechs. While banks expect that banking activities will increasingly shift to digital providers, they do not see that this will reduce the importance of banks because, in their view, branch operations and the advisory services will continue to play a major role in 2020. FinTechs naturally take another view: According to them, there will be multimedia offers based on the primary needs of customers, e.g. purchasing a home, in future. Banking services, i.e. financing in the case of property purchases, will be integrated into such offers and processed in a more or less impersonal way.
The developments of the next few years cannot be exactly predicted. A hint is provided by a quote of Chris Skinner, chairman of the Financial Services Club: “The speed of change is often overestimated, but the impact is underestimated.”