Disruptive innovation in Financial Services is having the greatest impact where the delivery is happening through business models which are platform based, light on capital & data & analytics intensive .This is making the industry very innovation focused and competitive as it gears up to provide its customers with upgraded, digitally intensive solutions across business lines such as banking, payments, cards, investment management and many more.
A few central themes emerge in this area and are summarized as follows:
Advanced emerging platforms and decentralized technologies have changed the way information is aggregated & analyzed, improving connectivity and accessibility while reducing the cost & time for accessing information and providing financial solutions across geographies.
Firms are increasingly relying on and leveraging advanced algorithms and computing power to automate manual activities ,allowing them to offer cheaper, swifter & scalable products and services to clients.
Role of Intermediaries
Latest innovations are changing or eliminating the role of traditional institutions as intermediaries, and offering lower prices and / or higher returns to customers
The Strategic Role of Data
Financial institutions are accessing new data sets like social data, customer online behavior & likes , which is redefining ways in which they are understanding customers and markets. It helps them to customize and offer bespoke offerings as per client requirement versus generic cookie cutter solutions.
Niche, Customized Products
With extensive availability of customer related data a lot of the financial institutions ,especially the new entrants are creating highly targeted products and services with deep & complex specializations, hence increasing competition and creating pressure for the traditional end-to-end financial services model to unbundle
In this flat world with high end technology & emerging innovations, customers now have access to previously restricted assets and services, more visibility into products and their features and benefits and hence a heightened ability to make intelligent,need based choices making them “prosumers”