Finance
Accenture report on digital banking
Maxim
Zmeyev/Reuters
-
Traditional banks tend to shrug off threats from
fintech upstarts, but new research has found that these
newcomers are quietly shaking up the banking industry. -
These new entrants have accumulated up to one-third of
new revenue, says a report from Accenture released on
Wednesday. -
The impact of these companies is different across
regions. In the US, they captured 3.5% of the total banking and
payment revenue in 2017, compared with 14% in the UK, Accenture
found.
Traditional banks tend to shrug off threats from fintech
upstarts, but new research has found that these newcomers are
quietly shaking up the banking industry.
According to a report released by Accenture on Wednesday, one in
six players in the banking industry in 2017 was a new entrant —
defined as a company that entered the market after 2005 — even as
the total number of banking and payments institutions declined by
nearly 20% from 2005 to 2017.
Notably, new entrants to the banking market — including
challenger banks, non-bank payments institutions, and big tech
companies — have accumulated up to one-third of new revenue,
Accenture found.
“While few of these new players have raised alarm bells among
traditional banks, the threat of reduced future revenue growth
opportunities is real and growing,” the report said.
New tech companies are popping up all over the globe, but they’ve
had different effects in different regions.
In the US, about 19% of financial companies in 2017 were new
entrants, but they made up only 3.5% of the more than $1 trillion
in banking and payment revenue, the report said. Regulatory
hurdles in the country have made it more difficult for new
entrants to break into the established industry, fostering a
relatively stable environment for incumbents, according to
Accenture.
But in the UK, whose government
launched a crypto-assets task force earlier this year and
developed a fintech regulatory sandbox, new entrants accounted
for 63% of the financial players and captured nearly 14% of total
banking and payment revenue last year, Accenture found.
Fintech’s impact in China is even more staggering. Ant Financial,
the digital-payments arm of Alibaba, and WeChat Pay, from the
social-media platform, have a combined 94% of the country’s
mobile-payments market
with more than 1.3 billion active users.
Accenture’s research was based on more than 20,000 banking and
payments institutions across seven markets, including Australia,
Canada, China, the EU, the UK, and the US.
-
Entertainment7 days ago
2024 summer TV preview: 33 TV shows to watch this summer
-
Business6 days ago
Google Gemini: Everything you need to know about the new generative AI platform
-
Business4 days ago
Haun Ventures is riding the bitcoin high
-
Entertainment6 days ago
‘Bridgerton’: Everything you need to remember before Season 3
-
Entertainment4 days ago
Hands-on with the Claude AI app: It’s pleasant to use, but janky
-
Entertainment4 days ago
5 essential gadgets for turning your home into a self-care sanctuary
-
Entertainment5 days ago
How to unblock porn sites: Greatest VPN for porn in 2024
-
Business6 days ago
Indian ride-hailing giant Ola cuts 180 jobs in profitability push