Big Tech or Traditional Banks: Who will win the Race?
There are numerous debates about the changes that Fintech is imbuing in the banking ecosystem and how it poses a serious challenge to the functioning of traditional banks. However, in spite of technological advances, the value that traditional banking imparts is not going to ebb away soon. Although traditional banks aren’t perfect, it nonetheless is an indispensable part of the society, employing nearly 20 million individuals and handling billions of transaction on a daily basis. Asides, with the current capital and the cash flow that traditional banks have, it is more equipped to lend money to individuals or new ventures, startups, and SMEs.
Many economists argue that the future of the bank is anchored around three major factors namely need, stress, and time and an organization’s ability to understand the nuances of this trio. Big Tech companies and banks are devising solutions that befit the aforementioned dictums in order to serve a greater audience with an underpinning aim of establishing hegemony in the marketplace. Additionally, another key area that both Big Tech and banks are targeting is interaction to opportunities. While the volume of interactions on social media and across all the websites of tech behemoths is humongous the traditional banks champion the quality race. Despite having a larger global presence along with turnkey technology, winning over people’s trust, which they have for traditional banks, is still a farfetched proposition.
In the impending years, provided banks start internalizing technology rapidly alongside expanding its product base, traditional banks can prove to be a threat for big tech companies that are vying to position themselves in the banking spectrum.