Of Special Interest
- Digital wallet spend in Europe & North America to increase by 40% in 2019, finds study
- Juniper forecasts mobile money transactions will exceed 200 billion by 2024
- Europe’s big bank problem: too much capital is trapped in the US, says Scope
- Banks can save the world from climate change, says former UN climate chief
- Research by NatWest reveals gender divide over attitudes to saving
- Later-Life lending market set to almost double in the next 10 years, finds report
- Barclays/Cebr report challenges nation to think differently about wealth
- Fifth of UK investors looking to debt investment, new research reveals
- Regtech will play a more important role in PSD2, says Mitek
- Banks turn to Fintech partnerships to improve customer experience, finds Fraedom
- New industry code to tackle fraud must deliver, says Which?
- New TTF report highlights loss of trust in financial services
- Arxan highlights financial app vulnerability epidemic
- SAS asks whether banks really need to choose between operations and innovation
- Which? raises alarm as almost 1,700 free ATMs become fee-charging
- Financial wellness affects half of peoples’ mental or physical health, finds report
- Study finds traditional financial institutions embrace Fintech disruption
- Grass is greener for environmentally friendly businesses, finds Barclays
- Prospective homeowners would consider a 40-year mortgage to escape renting, finds Santander
- Millennials’ needs are changing the face of banking industry, says new report
- FS is putting consumer data at risk by failing to protect mobile apps, says Arxan
- A lack of belief in their ability holds 28% women back in work, says Cambridge & Counties
- ‘Which?’ reveals Scotland has lost over a third of its bank branches in eight years
- Next downturn unlikely to be as bad as 2008, according to S&P
- FCA reveals findings from first cryptoassets consumer research
- US consumers favour single mobile app for banking and payments
- Banks suffering major IT shutdowns every day, ‘Which?’ reveals
- The US will be a key offshore centre in 2019, says GlobalData
- Debit industry changes markedly in 10 years of the Debit Issuer Study
- UK's ‘Big Five’ face ‘too big to compete’ as small challengers secure stellar returns
- Banks as vulnerable now as before crash, says new study
- Leverage ratio a constant conundrum for European and US banks, says SNL
12th April 2019
Millennials’ needs are changing the face of banking industry, says new report
By 2020, half of all payment service providers will be digital only, following a 51 per cent growth spurt of e-money firms in 2017–2018. The findings come from a new report, “The UK Fintech Revolution” from financial services and IT recruiter Robert Walters and market analysis experts Vacancy Soft.
Ollie Sexton, Principal at Robert Walters said: “Technology has transformed the way we do pretty much everything – from shopping to socialising - and the emergence of Fintech start-ups and their clever use of technology has made it easier for people to invest, make payments and even get a loan.
“For millennials who grew up with mobile devices this is particularly appealing because they want to conduct financial transactions the same way they would share pictures or apply for a job. The pace of change has been so rapid over the past five years that the perception of digital banking has shifted from an ‘option’ to a ‘requirement’.”
James Murray, Director of Financial Services said: “The 2008 global financial crisis resulted in employment within the banking industry declining by 7 per cent (100,000 people). This led to a period of stifled innovation, with banks understandably focussing on their balance sheets and profitability.
“This contraction in the market created the vacuum to enable the people with the expertise to develop the Fintech business models that had yet to be created within the banks themselves. Arguably it is only now, with the rise of the Fintech start-ups, that the banking sector has woken up and started to adapt to the new paradigm. As a result, IT is now constituting over 30 per cent of professional roles in the sector, up from 24 per cent in 2017, with this projected to increase further.”
In 2018 Fintech was the fastest growing sector in the UK – with job creation increasing by 61 per cent in London and by 18 per cent in regions outside of London, almost 80 per cent across the UK. This compares with just 17 per cent job creation for the banking and financial services sector across the whole of the UK in 2017–18.
Of the 29 Fintech ‘unicorns’ (ie companies worth more than $1bn) worldwide, nine are in San Francisco, while seven are housed in the UK. In fact, the UK’s Fintech unicorns had a combined revenue growth of 130 per cent in the last 12 months – an increase from £77.1m to £177.6m revenue.
Tom Chambers, Manager of Advanced Analytics and Engineering at Robert Walters said: “The rise of smartphones and 4G has significantly reduced barriers to entry for new players. The Fintech unicorns are spearheading innovation through successfully digitising payments, peer-to-peer (P2P) finance and fund transfer processes.
“As a result, incumbents in the banking sector find they are having to adapt to this wave of innovation to compete. With this in mind, banks are now utilising the latest technologies to streamline, resulting in a new wave of change, from closing branches to mobile-based payments.
“This means is that now the line between Fintech and traditional banking is becoming increasingly blurred, especially given the fact a Fintech company is now able to get an EU banking licence – allowing them to guarantee customer deposits.
“Currently, Fintech is still in the explosive phase. However, as well as embracing technology, it’s possible that established banks could scope the Fintech market for acquisition opportunities and increase segmentation of their core services to gain back competitive advantage.”