From 60 Minutes coverage to a weird story about the founder of Bitcoin, this week opened with some big fintech news.Fintech: Shaking up the financial industry
60 Minutes ran a spot about the rise of the fintech and what it means for traditional banks. They talked to John and Patrick Collison, the founders of Stripe, a fintech company that helps businesses get payments more easily, and Max Levchin, a co-founder of PayPal and early investor in Stripe. In addition, they interviewed Vikram Pandit, former CEO of Citigroup, who said that millennials are disillusioned with traditional banks. "We know that many banks served their own interests more than those of their consumers," Pandit said.
This is likely one of the strangest stories in the history of fintech. On Monday, Craig Wright, an Australian computer scientist, declaring that he is Satoshi Nakamoto, the psuedonym of the person who created Bitcoin. After his announcement, a bunch of Bitcoin afficianados backed him up. Then several experts said it was a scam. To settle the controversy, Wright said he would give “extraordinary proof” that he was indeed Bitcoin's founder. Then, a few days later, he backed out and said that he did not "have the courage" to share the proof. Now it appears that most Bitcoin afficianados doubt the claims.
TechCrunch's Josh Constine says that many fintech startups are actually making it more likely for consumers to stay with their current financial institution because they're creating products that connect to a checking account. After all, no one wants to reconnect a host of apps to a new checking account when they switch banks.
It's an interesting argument — though we're curious how it will hold up if the US adopts something like the Current Account Switch Service implemented in the UK. In that case, reconnecting apps with the new account will be so effortless that consumers might move en masse to the option that provides the best experience.
American Banker's Brian Patrick Eha tells why millennials are choosing the big banks, and essentially it all boils down to one word: mobile. From this data it's clear that any financial institution that wants to win the future needs to double down on offering a better mobile experience than their competitors.
Jim Marous summarizes an Oracle survey of 300 executives about the Age of the Individual. He writes that "80% of financial institution respondents said their organization has experienced a trend toward consumers wanting a more individualized experience ... but only 17% give their organization an “A” in its ability to offer these experiences." In addition, Marous recounts that executives estimate that getting individualization right will result in a 14% increase in annual revenue — an enormous differentiator year after year.
Photo by Tony