Finnovation Bye Bye Banks?

Transcription

1 Finnovation Bye Bye Banks? Prof Dr. Bjorn Cumps Vlerick Business School

2 HOW FAST IS IT GOING? FAST! 2

3 REMEMBER? 41% market share 3

4 HOW FAST IS IT GOING? FAST! 6 million units sold in 15 months 10 million units sold in first weekend 13 million units sold in first weekend 4

5 THE BANK OF THE FUTURE? Square POS payments Affirm Consumer credit TransferWise Money transfer Wealthfront - Investments Paypal - Payments Bitcoin Digital currency Venmo P2P Payments LevelMoney Personal Financial Management Moven Digital only bank Apple Pay - Payments Kickstarter - Funding

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7 HOW DO YOU EAT AN ELEPHANT? BANK

8 UNBUNDLING BYE BYE BANKS?

9 THEIR PLAN OF ATTACK

10 FINTECH WHAT THEY HAVE IN COMMON

11 3 FINTECH CATEGORIES Enhance what exists. (Apple, Google, Moven, Simple, ). They enhance yet do not truly transform the system. Enhancers Complement what exists. Fill a gap. Add new products, services or functionality to the existing financial system. Fintech Replace what exists. (P2P lending platforms) Take out the middle man using tech. Complementers Replacers

12 FINTECH WORLDWIDE

13 IMPACT OF DIGITAL DISRUPTION

14 IMPACT WHERE, WHEN AND HOW MUCH? Source: Citi digital strategy March 2016

15 FINTECH VENTURES Source: Accenture Fintech report 2016

16 25 LARGEST FINTECH DEALS Q1 2016

17 FINTECH SOME EXAMPLES

18 TRANSFERWISE - MONEY TRANSFER Exposed the hidden cost of international money transfers Banks hide huge fees in unfair exchange rates. Here s what it REALLY costs to send 1,000 to a Euro 90% of transfers processed within the day (source: transferwise) Transparency: fee = 0,5% User-friendly, app-based, straightforward

19 HOW IT WORKS

20 WEALTHFRONT ROBO-ADVISORY 2,6 billion $ AUM within 3 years Below 10K free Above 10K 0,25% fee No minimal amounts World-class diversified investments Automated monitoring + rebalancing 20

21 MOTIF INVESTING - INVESTMENTS Some motifs: Obamacare Rising interest rate Cleantech Cyber-security 7 deadly sins Thematic investing Thematically weighted basket of stocks User-friendly, straightforward Transparent costs 10$ per motif Compose your own motifs (engagement) Get paid when people buy your motif 21

22 IGARANTI (TURKEY) - NEOBANK Distill shopping preferences from transaction data Location-based offering of your favorite products Social money transfers Digital wallet 22

23 CONVERSATIONAL BANKING

24 MONDO

25 SQUARE - PAYMENTS 25

26 KABBAGE - LENDING 26

27 WHAT ABOUT INSURANCE?

28 INSURANCE IS NEXT Insurance represents a huge opportunity that has yet to see real innovation. The U.S. insurance industry is the largest in the world in terms of revenue, with net premiums surpassing $1.2 trillion. At the same time, the major players have some of the lowest Net Promoter Score (NPS) ratings of any industry, meaning the companies do not inspire satisfaction or loyalty in their customers.

29 YES, THE SAME IS HAPPENING IN INSURANCE

30 DIGITISATION OF INSURANCE Personal Insurance Realtime & usagebased Interaction

31 OSCAR Valued at $1,5 billion 16 months after go-live

32 TROV

33 WHAT ABOUT BELGIUM?

34 YES, WE HAVE FINTECH ENTREPRENEURS

35 ROBO-ADVISORY

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43 TOWARDS A NEW FS LANDSCAPE

44 THEY WANT A PIECE OF THE CAKE

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49 FINTECH FINTECH BUNDLING Alongside our partnership with LHV, this marks the launch the TransferWise FinTech API. This means we'll partner with additional modern banks, messaging applications, marketplaces, and mobile carriers to seamlessly integrate fair and transparent pricing into their core products. If you re interested in discussing a partnership with TransferWise, please partnerships@transferwise.com.

50 NEW TYPES OF COLLABORATION EMERGE Scale Customers Business knowledge License Capital Reg expertise Digital Giants Platforms Users Delighters Complementary services Cash Innovation culture Traditional Banks Fintech Startups UX No legacy Simplicity Transparency Focus Drive to innovate 50

51 DIFFERENT ENGAGEMENT MODES

52 NEW OPERATING MODELS

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54 DISTRIBUTED

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57 GAINING TRACTION

58 NEW OPERATING MODELS ARE EMERGING

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63 WHICH SCENARIO? IT DEPENDS

64 BEYOND THE FS SECTOR THE ADVENT OF ECOSYSTEMS

65 COMMONWEALTH BANK OF AUSTRALIA 65

66 THE RIGHT MOMENT Need identification Purchase New interaction points Old interaction points

67 THE MORTGAGE ECOSYSTEM Competitors Immo agency AR softw provider Home buyer Immo federation 67

68 THE BATTLE OF THE ECOSYSTEMS/PLATFORMS

69 COMPETITION IS CHANGING FROM TO

70 WHAT S A BANK TO DO?

71 BANKS WEAKNESSES

72 BANKS STRENGTHS

73 SCANNING - FINTECH

74 EMBEDDED BANKING

75 ONLY OPEN ECOSYSTEMS CAN OFFER THIS 589

76 Knowledge of end customer Partial Complete THE NEXT-GEN ENTERPRISE Omnichannel Business (traditional banks) Open Ecosystem Driver (Amazon, Facebook, ) Supplier (agents, brokers) Modular producer (PayPal, Stripe, Dwolla, ) Value Chain Ecosystem Business Design 76 Source: Peter Weill MIT CISR

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79 Add-on services Payment services Banking services 79

80 MEET THE FINTECH BANK

81 MEET THE FINTECH BANK

82 PARTNERING BEYOND FINANCIAL SERVICES Energy Healthcare Travel Mobility Cities Telco Retail

83 THANK YOU! Prof. Dr. Bjorn Cumps