Future of Financial Services

Growth in FinTech is Shaping the Future of Invisible Finance & Virtual Banking

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The financial services industry is on the brink of disruption, as the use of technology poses a challenge to market players and their existing products and services and associated costs. Thus it is important to revisit one of the oldest industries and re-conceptualize how it will thrive in the future aligning itself to looming social and technological trends.

This study will address implications to the labor force employed in the financial services market, as a lot of the responsibilities currently held by individuals will be susceptible to automation. Another consequence to automation might be the role of institutions in the industry moving to advisory rather than transaction processing. An interesting development we foresee is also reduction in costs to customers, as fee structures contract by incentivizing voluntary submission of customer purchasing habits. As funding and lending channels move from traditional wealth management institutions to more open and platformized or peer-to-peer lending, it will be interesting to gauge how the 'micro-investments' market might be one of the largest drivers of investments in the future.

Table of Contents

1. Executive Summary
Key Findings
2. Research Scope, Objectives, and Background
Research Scope
Study Period
Forecast Period
Geographical Scope
Industries Covered
Research Background
Research Methodology
Macro
Identify Mega Trend Through Brainstorming Sessions
Identify Sub-trend Through Scenario-building Exercises
Micro
Assess the Impact of the Mega Trend at a Micro Level
Opportunities Analysis
Research Methodology
Key Industry Participants, Global, 2016
3. Overview and Introduction
Definition of Fintech
Segments of Financial Services Directly Impacted by Fintech
4. Key Disruptions in Segments
Payments
Key Areas of Disruption
Key Levers
Virtual Currencies: Hidden Transactions
Online Processing
Blockchain
Blockchain Use Cases
Blockchain in a Payment Transaction
Artificial Intelligence
Artificial Intelligence Evolution in Fraud Analytics
Future Intelligent Detection Process Using Artificial Intelligence
Corporate Administration
Fintech in Corporate Administration—Future Disruptions in Corporate Administration
B2B Payments
Market Growth Snapshot
Payment Platforms
Key Features of B2B Payment Platforms
Real-Time Payments
Central Clearing Approach (Current)
Distributed Clearing Approach (Future)
Smart Contracts
Illustrative Example of Procure to Pay Process Using the Blockchain in B2B Transactions
Insurance
Key Areas of Disruption
Key Levers
Connected Insurance
Wearables
Telematics
Insurer Benefits
Insured or Policy Holder Benefits
Impact of Telematics
Current Trend in User-based Insurance (UBI)
Progressive Customer
Risk Sharing Insurance Business Model
Smartphone-based Solution— Kony Case Study
UBI Market for Passenger Vehicles: Smartphone-based Solution Kony, North America, 2013–2020
New Business Models
Cost Advantage of Digital Insurers
Banking & Funding/Lending
Key Areas of Disruption
Key Levers
Micro-investments: Shrinking Investment Size
Definition
Examples of Micro Investment Wealth Managers
Drivers for Micro-investments
Platforms
Crowd Funding
Blockchain As a Financial Control Mechanism
Blockchain Money Cycle: New Money on Demand
Bank of the Future
Current Features
Future Features
Retail Banking
Shrinking Branches
Future Changes In Global Retail Banking Branch Operations
Case Study—Citi Future Branch Model
Cost Advantage of Platformized Banking or Digital Banking
Business Support Functions
Key Areas of Disruption
Key Levers
Biometrics
Case Study: Biometric Applications for the Payments Industry
Business Support Functions—Big Data: Data Lifecycle
Connected Financial Services
Big Data Adoption by Phases, 2015
Digital Strategies through Big Data
Implications
Business Support Functions
Artificial Intelligence
Artificial Intelligence Use Cases
How Artificial Intelligence Works
Artificial Intelligence Information Processing
Artificial Intelligence Information Processing
Use Cases For Artificial Intelligence
5. Funding of Fintech
Global Funding of Fintech Companies
Global Consumer Wealth Growth Mirrors Fintech Funding Globally
Total Bitcoin and Blockchain VC Funding has Almost Reached $1 Billion, Led by Multiconcept Businesses
Geographic Leaders in Specific Fintech Spaces
6. Trends in Financial Services
Trend Overview—Automation Implications to Labor Force
End-to-End Processes by Level of Automation (%)
Top Automation-Ready Processes
Key Implications
Case Study—Bankable: Banking as a Service
Cross-cutting Characteristics
Products
Solutions to Institutions
Turnkey Solutions
Value Proposition
Factors Critical to this Trend
Trend Overview—New Investor Classes
Emerging Investor Class
Millennial & Gen X Investor Preferences, US
Case Study—eToro: The New Age of Social Trading
Platforms
Options to Trade
Network of Traders
Factors Critical to this Trend
Trend Overview—Zero-Cost Wealth Management
Differences Between Traditional & Future Wealth Management Systems
Reasons for Shifting Asset Management Service Providers
Growth of Investment by Annual Cost of Portfolio Management (Illustrative)
Case Study—Betterment
Expense Ratio (%)
Number of Allocation Changes
Factors Critical to this Trend
Trend Overview—Transactional Brokerage to Advisory Business Models
Transactional Brokerage
Future Advisory Model
Transactional Brokerage To Advisory Business Models Evolution
Factors Critical to this Trend
Trend Overview—Crowd-Sourced Finance
Peer-to-Peer Lending Business Model
No. of Platforms
Countries
Factors Critical to this Trend
Trend Overview—Customer Data Incentivization
Direct Data Monetization
Indirect Data Monetization
Data usage
Data Monetization Steps
Factors Critical to this Trend
Trend Overview—Decentralized Autonomous Organization (DAO)
Factors Critical to this Trend
7. Profiles of Fintech Disruptors
Fintech Landscape
Friendsurance
Overview
Operations Snapshot
Value Proposition
Betterment
LendingClub
OpenFin
Bankable
eToro
8. Conclusion
Expected Transformations
Blockchain Beyond Bitcoin—The Future of Digital Distributed Ledgers
Key Conclusions
Expected Market Developments to 2025
Legal Disclaimer


List of Figures & Charts

1. Hidden Transactions Origination,Global,2015


1. Non-Cash Transactions by Region, Global, 2015, 2018 and 2020
2. Revenue Forecast of Smart Machines Vs Neurocomputers, Global, 2014, 2019 and 2024
3. B2B Total Sales & B2B Payments Revenue Forecast, Global, 2015–2020
4. Total Funding Volume, Global, 2012–2015
5. Crowd Funding Volume Growth (Year on Year), Global, 2014
6. Percentage Funding Volumes Growth By Type Year on Year), Global, 2014
7. Funding of Fintech Companies*: Global, 2010–2016(Q2) and 2020
8. Growth in Consumer Wealth ($ Trillion), Global, 2014 and 2025
9. Funding, Global, (2012–2015) ,Top Applications By Funding, Global, 2015
10. Full-time Employee Reduction in Banking, US and Europe, 2 015 and 2025
11. Socioeconomic Status of Investors, US, 2015
12. Peer-to-Peer Lending Market Size, Global, 2014, 2018, 2022 and 2025



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