Are Swiss banks succombing to FinTech fever?
Financial Technology, or FinTech for short, is not a recent phenomenon. Older breakthroughs such as the credit cards launched in 1950, the first ATMs or electronic trading on stock exchanges are as much a part of financial technology as the Internet, for example.
Nevertheless, the buzzword FinTech has only gained ground in recent years due to the rise of start-ups using their compact structures and streamlined processes to rapidly develop new technology and make particularly significant strides in the digital environment. This technology has shaken up the financial sector in numerous ways, from online loans, payments and bank transfers to crowdfunding, virtual currencies and digital investment advisors.
Some banks regard these new FinTech offerings as a danger to their traditional business model rather than a supplement to their existing services. The Bitcoin virtual currency, for example, already enables consumers to make payments without enlisting the help of their bank. Electronic asset management, commonly referred to as 'robo-advisory', could replace traditional investment advisors.
In contrast, other financial institutions are welcoming and promoting this trend as something that opens up completely new opportunities to customers, companies and investors alike. Swissquote Bank CEO Marc Bürki is convinced that this digitisation and new technology has a bright future, but acknowledges that financial institutions must adjust their business models. The area of robo-advisors offers particularly significant potential.
"Computers are better than their human counterparts when it comes to asset management, as they are completely neutral when it comes to emotions and classic forms of misconduct in investment. They can also run through thousands of scenarios and make adjustments to portfolios in seconds, something no human asset manager could ever do."
The FinTech sector is experiencing a rapid and unstoppable rise. The intelligent use and integration of new technologies promises to add value for all concerned. We live in exciting times!