Chapter 3: Fintech: The Genie Will Not Turn Back To His Bottle

A FinTech firm is a company that provides new financial services or solutions to financial actors, based on new technologies such as Blockchain, Big Data, Machine Learning or provides business processes digitalization. Usually, FinTechs have been created around a business process in order to make it simpler, faster, and cheaper.

These new players to the financial industry have experienced a significant growth in recent years, particularly in Europe and Asia. For example, there were 111 FinTechs in Switzerland in 2015 compared with around 350 companies today. Global investment in FinTechs increased fivefold between 2016 and 2018 and totaled USD 111.8bn in 2018. FinTech has become a large playground for investors who are convinced by the potential of the digital transformation of the banking and insurance sectors. FinTechs are becoming mainstream in large part due to B2C (business-to-consumer) offerings such as alternative payment systems, Robo-advisors and crowd funding/lending platforms. A 2017 survey has shown that the average percentage of digitally active consumers using FinTech services reached 33% across the 20 markets surveyed (30% in Switzerland). However, the success of some of these B2C FinTechs is overshadowing the wide range of creative and attractive B2B (business-to-business) offers.