We are only about three months into the year, but robos have already made waves in the wealth management #space, and the ongoing debate of human vs #robo vs hybrid models continues. If you haven’t been following: Yesterday, Charles Schwab — one of the more “traditional” players in the wealth management space &8212; launched its […]
Tagged: robo Toggle Comment Threads | Keyboard Shortcuts
We are only about three months into the year, but robos have already made waves in the wealth management #space, and the ongoing debate of human vs #robo vs hybrid models continues. If you haven’t been following: Yesterday, Charles Schwab — one of the more “traditional” players in the wealth management space &8212; launched its […]
#Challenger banks are a fascinating bunch. As varied as they are — Monzo, Atom, Tandem, Starling and other UK market newcomers — they have one thing in common: obsession with amazing customer experience, customer-centric propositions and fee transparency.
I love these amazing propositions as much as anyone — however, I had a chance to work on a project with one of the UK challenger #banks recently which included deep diving on a #business model for one of the considered products in the bank’s pipeline.
The project (along with Stephen Lemon’s quote — even though I don’t think he was addressing the challenger banks at all) got me thinking about what comes next after the amazing customer experience and value propositions? Will the challengers be able to sustain these experiences under financing and profitability pressures?
Consider the following example — Monzo is trying to make itself useful for traveling card holders as it informs on its blog:
“At Mondo [sic], we love to travel and hate to play games with our banks while we are away. You’ll be pleased to hear we don’t charge any fees for using your card abroad, neither at points of sale nor at ATMs. 🎉…We pass the MasterCard exchange rate directly onto you”1
Or another one — Atom Bank has recently (February 2017) announced the best fixed term saving accounts proposition in the market which “annihilates” the rest of the competition as reported by This Is Money:
Put-upon British savers have been thrown a lifeline with the surprise launch of a one-year account paying 2 per cent today…Beating the current top-paying one-year bond by 0.4 percentage points, Atom Bank has sent ripples through the savings market and provided an account which currently beats inflation.2
We see similar amazing customer value deals emerge across challengers. What’s next for the challengers then from a business model perspective?
Case In Point: A Failed ‘Challenger’ Bank in CEE
A graphic example of business model failure: Zuno is (or rather was) an all-digital bank that was launched in Central Europe (Slovakia and Czech Republic) back in 2010 as a project of Raiffeisen Bank International.
On one hand, I admit that the comparison to current UK challengers is a bit stretched ( or preposterous?).
After all, these are different markets and admittedly Zuno was not up to par in level of innovation and customer centric approach as its UK peers are (in the end, Zuno was an outpost of an incumbent bank).
Some of Zuno’s assets: mobile application, premium credit and debit cards (source: http://www.zuno.sk)
Before disregarding my comparison, consider the many similarities between Zuno and its UK counterparts:
- “Less bank, more life” was to be Zuno’s main tagline; reflecting its desired appeal to a young, dynamic and active population
- Main propositions at launch were “customer transparency, online finance management, free current accounts and favourable saving rates”
- Purely digital distribution (web & mobile) with no bank branches
- 266,000 KYC-ed clients in Czech Republic and Slovakia200 employees as of March 2016
- Approximately 800 million euros in deposits and 80 million in loans
Ultimately, Zuno did not achieve profitability and in total lost approximately 130 million euros over its lifetime. Eventually, Zuno was shut down:, its banking license voluntarily revoked and its customer assets transferred to other banks within the Raiffeisen Group.
What is the main takeaway from Zuno’s failure? It is not rooted in a market maturity issue or misalignment of the value proposition (in fact, the 266,000 accounts in Zuno’s markets would translate to somewhere around 1.1 million accounts in the United Kingdom).
The failure was purely on the business model side and inability to monetize its customer base on the credit side. As Zuno’s CEO at the time pointed out, the only mistake [they made] was that the bank had not started building its credit product portfolio from the get-go, which, in turn, led to their inability to generate revenues in a low interest rate environment.6
Simply put, the business model grounding of the bank’s market operation was amiss.
Challenger Banks Are In Customer/Fund Acquisition Phase
I would wager all challengers are in a net loss-generating phase of their existence. They make big positioning and product bets to scale their customer and deposit bases which will be monetized in the mid- to long-term timeframe.
On one hand, this is nothing unfamiliar in the startup universum. Snap, for example, has recently reported in its IPO filing losses of $514.6 million in 2016 and “may never achieve or maintain profitability”.
For various reasons I don’t think the challenger banks will be able to afford such liberty with their bottom-line results. The question then remains — how will challengers banks generate enough money to satisfy venture capital expectations, cover their operating costs and create meaningful profit?
Early Monetization Is Materializing
In the short term, the evidence of this can be seen with one of the earliest market entrants to the neo-bank space, Berlin-based N26. The now fully licensed bank has moved on from its previous modus operandi with Wirecard and free of charge service offering.
N26 is now starting to monetise on new users on card issuing, ATM withdrawals and introduction of first paid products such as premium current account with an insurance bundled in.
As we also know N26 has introduced its partnership strategy which will presumably generate incremental revenues for the bank as well. N26 now distributes the likes of Transferwise and vaamo, a German #robo-advisor — “N26 is using vaamo’s API to offer clients N26 Invest, a co-branded solution that lets users select from three investment strategies depending on their risk tolerance.”4
Current N26 pricing (source: N26.com):
However, I would argue that monetization efforts as seen with N26 are only the very first step in a long way to profitability for the neo-banks.
Let’s take a step back and see what lessons are there to be learned on profitability and revenue streams from traditional players in the banking market.
Taking a Step Back: 6 Lessons on Profitability from Incumbents
Note: Profitability of retail banks is a complex and complicated area of study — full academic studies and white papers by consulting firms are devoted solely to discussing its intricacies. For purposes of this article, I will try to keep it simple and put forward a couple of highlights I personally find important in context of implications for the challenger banks.
1. How Do Retail Banks Actually Make Money? (a.k.a the boring part)
Retail banks have two primary sources of income: interest income; and fees and commissions income.
Interest income is primarily earned by a bank lending money to customers and charging interest on the amount lent. A bank earns interest income by lending money to customers at higher rates of interest than it costs the bank to borrow funds from depositors and/or wholesale markets.
Fees and commissions income: banks earn fees and commissions income by charging customers fees for services and receiving commissions from, and participating in profit-sharing agreements with, other product providers. Examples of fees and commissions include fees for use of an overdraft, fees for packaged accounts, and income from the ATM (cash machine) network.7
2. Product Point of View (and Importance of Mortgages in the UK market)
An interesting insight on a UK retail bank product profitability comes from Credit Suisse research. Unsurprisingly, the most profitable products can be found exclusively on the credit side of retail products:
“Among the banks we have studied, we find that mortgages are the most profitable lending product (average ‘clean’ RoE of 28%), followed by credit cards (26%); with SME lending (12%) and consumer credit (7%).”5
In fact, Credit Suisse attributes such a weight to a successful mortgage offering that it is singled out as one of the three key profitability drivers for UK-based retail bank.
From the challenger’s perspective, it is interesting to note that the most profitable retail product is at the same time one the most complicated to distribute digitally (Oliver Wyman):
3. Importance of Interest Income
It turns out that interest income — i.e. charging interest on outstanding liabilities — is an extremely important revenue stream for the incumbents.
What’s more, share of interest income has increased significantly — from 65% in 2008 to around 75% in 2013 according to Credit Suisse research. Beyond cyclical trends, ‘there has been a more structural shift in the industry’s ability to generate peripheral revenues beyond pure interest-related income.’5
AT Kearney reports that ‘Different regulations, such as free current accounts, lending fee limitations, and caps on interchange fees, have impacted (and will continue to impact) banks’ ability to generate fee-based revenues.’ According to CMA, AT Kearney also reported that the share of net interest income in UK retail banks’ total income was the highest in Europe at 82%.
Another point of view besides the regulatory limitations is that traditional banks are simply not good enough at generating ‘innovative’ revenue streams from context and customer relevant 3rd party service offerings, new types of partnerships and beyond banking offerings — which might where the challengers could shine.
4. Importance of SME Businesses
Perhaps unsurprisingly, it turns out SME business is extremely important for the large UK incumbents.
In fact, revenues from personal current accounts for the eight largest banks totalled £7.44 billion in 2014, while SME revenues for the seven largest banks totalled £7.1 billion in 2014.
Unsurprisingly still, banking SMEs is much more lucrative on a per customer basis compared to a retail current account customer.
5 Importance of Costs
Naturally costs are a big part of the profitability equation.
Consider the following — according to Oliver Wyman, 30% of all costs of a typical retail bank in the UK is consumed by its branch network. An additional 20% is eaten up by IT; a huge chunk of it certainly going towards maintaining legacy systems.
In addition, it is estimated that on average, 5–6% of their revenue base is given up by the big retails banks as an effect of impairments.
I believe challengers have a great opportunity to alleviate the short to mid-term pressure on their bottom-line and competitive positioning if they are smart about their cost base, deployment of resources and investing into the right #technology and processes.
6 Importance of Scale and Funding Structure
The following two points are courtesy of Credit Suisse research:
Scale alone is not enough, but is a necessary attribute — Although not enough on its own to determine profitability, our analysis suggests that without scale it is very challenging for a stand-alone business to be in the top quartile of sector profitability.
Funding structure…is one of the most important differentiators. We see a clear positive bias [in regards to UK retail banking profitability] towards a higher proportion of current accounts/low interest bearing deposits.5
(My) Observations for Challengers
- Have a clear strategy that enables customer (and customer deposits) onboarding and retention in the short to mid term timeframe, particularly on low interest bearing products. Keep in mind that scale itself is not enough at all times.
- At the same, have a clear mid- to long-term strategy on the credit side of your products. This pertains especially to those offerings which are at the time being difficult to deliver via digital and particularly mobile channels such as mortgages; as these products are at the very core of profitability of retail banking.
- Start thinking about how to tap into the lucrative SME market with SME propositions or profit-generating partnerships; especially…
Finish reading at Medium. Got a perspective? Please join the debate!
2 A one-year savings account at 2%: Atom Bank blows away rivals with new inflation-beating rates, http://www.thisismoney.co.uk/money/saving/article-4252282/Atom-launches-new-one-year-fixed-rate-savings-paying-2.html
3 ‘Very questionable models’: The cofounder of a #fintech startup addresses the elephant in the room, http://uk.businessinsider.com/currency-clouds-stephen-lemon-questions-fintech-business-models-2016-6
4 vaamo Partners with N26 (Formerly Number26) http://finovate.com/vaamo-partners-n26/
5 Credit Suisse UK banking Seminar — 2015 Update, https://doc.research-and-analytics.csfb.com/docView?language=ENG&source=ulg&format=PDF&document_id=1050375611&serialid=D3fAivrz0KjVObVAhNsc5e1OnBva50uGToQzZoM6ekA%3D
6 Celý príbeh Zuna: Klienti ho chceli, investori nie https://www.etrend.sk/trend-archiv/rok-2016/cislo-41/zuno-banka-konci-klienti-ju-chceli-investori-nie.html
7 Competition & Markets Authority, Retail banking market investigation — Retail banking financial performance, August 2015, https://www.gov.uk/cma-cases/review-of-banking-for-small-and-medium-sized-businesses-smes-in-the-uk
8 Oliwer Wyman, Perspectives on the UK Retail Market, November 2012, http://www.oliverwyman.com/our-expertise/insights/2012/nov/perspectives-on-the-uk-retail-banking-market.html#.VbIMPPlViko
is Co Founder at The Booster Labs
Consumers are increasingly comfortable with automated investing, but that may not be such a good thing. According to a global study conducted by Accenture, seven out of ten consumers surveyed would “welcome” automation—or #robo-advisors—into their financial lives, including a high level of comfort, almost 80% (78%), with #robos in traditionalRead More
Partnerships, funding rounds, startups, acquisitions – robos have had a busy year. More and more companies jumped on the #robo-advising bandwagon this year, while independent companies grew exponentially and snatched big-name partners. While the current #technology allows for a fully automated portfolio management system, we saw a lot of theRead More
#Robo-advisors, wealth management algorithms typically offered at low costs and with little human interaction, are gaining stream. Globally, wealth managers were responsible for US$ 74 trillion in assets under management (AUM) in 2014. BI Intelligence predicts that robo-advisors will manage around 10% of total global AUM by 2020. This equates to around US$ 8 trillion in robo-advisors AUM.
Robo-advisors are a class of #financial adviser that provides financial advice or portfolio management online with minimal human interaction. Much of the focus has been on portfolio management and most of these platform use algorithms such as Modern portfolio theory.
Today, popular platforms include US-based Wealthfront and Betterment, UK-based Nutmeg, Australian Stockspot, German Vaamo, among others. In Switzerland we have Truewealth, Glarner KB, Swissquote and some new platforms which are going live soon.
A research conducted by BI Intelligence found that consumers across all classes are receptive to robo-advisors, including the wealthy. 49% of this group would consider investing some of their assets using a robo-#advisor.
With robo-advisory on the rise, the wealth management industry is undergoing significant disruption.
According to Deloitte, robo-advisors hold some distinct advantages and are disrupting the industry in the following ways:
– The lower fees have broadened the market for advice to include the majority chunk of untapped wealth. More mass-market consumers can now afford advice.
&8211; Robo-advisory is more appealing to the new generation of wealth, which seeks more control, who is digitally savvy, and demands greater availability.
&8211; With large wealth management firms investing heavily in big data and advanced analytics, robo-advisory can become even more personalized and specific over time.
&8211; Many wealth management firms have already begun incorporating robo-advice capabilities within their existing advisory offerings to create hybrid models.
&8211; #Technology has lowered barriers to entry for new firms to break into wealth management. This has brought new levels of competition and innovation to the industry.
Hybrid human-robo advisors
After the strong growth of the robo-advisory approach in recent years, promoted by numerous startups worldwide as well as a sizeable number of early adopting wealth managers, a new “sub-species” has emerged: the hybrid human-robo advisor.
According to MyPrivateBanking’s report &8220;Hybrid Robos: how combining human and automated wealth advice delivers superior results and gains market share,&8221; these platforms combine computerized recommendations with on-demand advice from a human being.
They use technology to standardize and cut costs on the information-gathering side of the job.
The report found that pure robo-advisors (completely automated without personal service added on) have seen their growth slowing down as the market matures. Notably, Betterment&8217;s growth rate for AUM has remained at the same place it was a year ago.
This is due to clients “starting to realize that what they’re getting from many providers is little more than a passive portfolio that they can easily build on their own without the robo middleman,” the report says.
MyPrivateBanking estimates that hybrid robo-advisors will grow to a size of US$ 3,700 billion assets worldwide by 2020. By 2025, the total market size will further increase to US$ 16,300 billion. This number constitutes just over 10% of the total investable wealth in 2025. By comparison, pure robo-advisors will have a market share of 1.6% of the total global wealth at that stage.
&8220;Hybrid robo solutions are a dynamic and also unstable new phase in the wealth management industry&8217;s transformation,&8221; the report says. &8220;We expect 2016 to be a year of significant developments.&8221;
So far, notable hybrid robo-advisors include Vanguard, Personal Capital, Rebalance IRA and AssetBuilder.Featured image: Robot and human touching forefingers by Pixelbliss, via Shutterstock.com.
The post The Role Of The New Advisor In The Digital Financial World appeared first on Fintech Schweiz Digital Finance News – FintechNewsCH.
In the transition from in-person advice from financial planners, to a fully #robo experience available at your fingertips, there is (at least) one step in between: the cyborg model. In the world of financial advice, a hybrid advisory system, which combines fully automated algorithm-driven advice and certified (human) professionals, seemsRead More
The Commercial #Bank of #Dubai (CBD), announced late in November that it is launching “CBD Now”, Dubai’s #first #digital-only bank. They aim to target millennials and digitally connected customers early in 2017.
Peter Baltussen, CEO of Commercial Bank of Dubai said, “The launch of CBD Now during 2016 UAE’s innovation week is a timely example of how CBD supports the vision of the UAE government to develop innovation and drive client happiness.”
Digital-only Banking allows customers to totally change how they manage their finances. They can now use smart #technology to fulfil all their banking needs. CBD will offer customers a technologically smart, and seamless mobile bank, personalised to enable them to perform all their usual financial services from anywhere via their smartphone. So whether it’s managing your current accounts, savings accounts or credit cards that you need, this new development will serve you well.
This news comes hot on the heels of Emirates NBD’s announcement in June that they would be investing Dh500million (US$ 136million) in digital banking systems. Mindful of the fact that the bank is losing its appeal with Millennials, this move is aimed squarely at younger customers.The bank’s Chief Executive, Mr Shayne Nelson said, “We are making a commitment to the future with our digital transformation plan.”
The move into digital banking, globally, has seen huge benefits for #banks and customers. For customers there is a huge improvement in convenience and speed of service, whereas these systems also make cost savings for the banks. There are approximately 800 million customers now using mobile banking systems worldwide. This number is expected to increase to over 1.9billion by the year 2019, according to a report by the auditing company KPMG.
The UAE has a young and affluent population, which is driving the move to digitisation. According to a recent Google study, its 9.2 million population has the highest penetration of smartphone use in the world, at about 70 per cent. Traditionally here, cash has always been king, with credit cards often shunned by young affluent people. However, the ease of use of digital banking is starting to capture the imagination.
EY GCC Digital Banking Report 2015 found that half the banks they surveyed have budgeted between US$ 5 million and US$ 20 million for digital initiatives. These included automation, channels, customer journeys and new technologies etc. Furthermore they found that many of the larger banks were demonstrably willing to spend even more. Possible even more exciting was the fact that banks saw this as a rebirth, rather than an incremental approach to modernisation. Digital-first, a Sharia-compliant retail bank in Saudi Arabia, more than demonstrated this.
The island kingdom of Bahrain is also moving swiftly to keep up. A number of state bodies including the Central Bank of Bahrain (CBB) are involved in looking at ways in which to develop its #fintech sector. Areas of interest are: Islamic finance, in which in which Bahrain has strong global standing; crowdfunding; payment services; online wealth management service (#robo-advisors); and #blockchain.
Moving forward, CBD Now Co-founders programme being #launched in the near future involves enabling pioneering customers to provide input into building the bank of their dreams. Murray Sims, General Manager Personal Banking Group at Commercial Bank of Dubai, said, “We believe our customers have a lot of know-how when it comes to banking services. Customers can assist during the piloting phase to influence product development and refinements before rolling out the brand to the public.”
Things are really hotting up in the digital banking sector within the Emirates.
The post First Digital Bank Launched in Dubai appeared first on Fintech Schweiz Digital Finance News – FintechNewsCH.
Blockchain: Blockchain, Smart Contracts, Investing in Ethereum, FinTech
by Jeff Reed
Blockchain: Blockchain, Smart Contracts, Investing in Ethereum, FinTech by Jeff Reed combines four of his best-selling books, all covering blockchain technology and fintech. These are:
Blockchain: The Essential Guide to Understanding the Blockchain Revolution
Blockchain is far more than #Bitcoin technology, and even in its infancy, it is taking the world by storm, from major #banks to the U.S. Department of Defense. This book is a comprehensive guide to blockchain, helping you understand what it is and why it matter.
Smart Contracts: The Essential Guide to Using Blockchain Smart Contracts for #Cryptocurrency Exchange
This book explains the fundamentals of Smart Contracts and how they work. The practical uses of Smart Contracts are enumerated in this book and you will also learn how you can make your own Smart Contracts in the Ethereum system. You will also get tips on how you can make your Smart Contacts easy to understand and user-friendly. This book also covers some of the myths surrounding smart contracts and the reasons why they exist.
Investing in Ethereum: The Essential Guide to Profiting from Cryptocurrencies
This book explains the reasons to invest in Ethereum and not just because of the potential ROI, but also the benefits of cryptocurrencies in themselves. The overall risks, obstacles, and major changes in Ethereum will also be addressed. There are over 1,000 cryptocurrencies that currently exist, it’s important to choose wisely and understand everything you can if you’re going to be putting real money into the blockchain.
FinTech: Financial Technology and Modern Finance in the 21st Century
This book will introduce you to the basics of FinTech and equip you with the knowledge to get on the cutting edge of age we live in today. It covers the impact of fintech on the global economy, the payment ecosystem, fintech solutions in the business-to-business sector, fintech and investing, and much more.
FinTech: The Beginner&8217;s Guide To Financial Technology
by Jacob William
In FinTech: The Beginner&8217;s Guide To Financial Technology, Jacob William explains what FinTech is, why it matters to everyone, future predictions about it, possible dangers, and its origins and history.
This book will give you the information you seek in a digestible and easy-to-follow format. No prior knowledge of technical subjects is necessary because understandable examples are given throughout.
Learning more about something that is so prevalent in our society is undeniably beneficial whether you are a business owner, technology enthusiast, or just a curious layman.
FinTech: The Impact and Influence of Financial Technology on Banking and the Finance Industry
by Richard Hayen
We’re in the middle of the FinTech revolution, and it’s a big one. Everything that we know about the world of finance is changing before us. Innovation is constantly happening. FinTech: The Impact and Influence of Financial Technology on Banking and the Finance Industry is going to help you get up to speed on all of the change that’s happened and the things that are important right now.
This book is going to teach you about several things, including the fintech sector and its impact on traditional banking, on the global economy, and on the world at large.
It will teach you about cryptocurrencies such as bitcoin, blockchain technology, #robo-advisors, peer-to-peer lending, crowdfunding, but also about the state of FinTech and where it is heading.
Blockchain: 4 Manuscripts—Blockchain, Fintech, Investing in Ethereum, and Smart Contracts
by Oscar Flynt
Blockchain: 4 Manuscripts—Blockchain, Fintech, Investing in Ethereum, and Smart Contracts combines four of Oscar Flynt’s books covering blockchain technology, fintech, Ethereum and smart contracts:
Blockchain: The Ultimate Guide to Understanding the Hidden Economy
Blockchains are changing everything from banking, shopping, peer-to-peer exchange, and our daily lives as a whole. Those who learn blockchain and how to utilize them will have a preemptive jump on their competition. You’ll discover how to use them, their shortcomings, all about smart contracts, and much more.
FinTech: Understanding Financial Technology and its Radical Disruption of Modern Finance
This book covers everything from future trading, online banking, conducting business, daily living, and much more. You’ll discover the exciting opportunities that await in the coming years and how you can capitalize on them.
Investing in Ethereum: The Ultimate Guide to Learning—and Profiting from—Cryptocurrencies
Ethereum is one of the most profitable and promising platforms to trade cryptocurrency on to date. In this book you’ll learn all about this amazing platform, how to trade on it, how set up smart contracts, and how to program the right software to use it.
Smart Contracts: How to use Blockchain Smart Contracts for Cryptocurrency Exchange
Smart contracts are speculated to lower legal disputes, re-structure banking and finance, and change the way people shop and make money forever. This book will teach you how to create them.
Bankruption: How Community Banking Can Survive Fintech
by John Waupsh
Community banking can flourish in the face of fintech and global competition with a fresh approach to strategy. Bankruption: How Community Banking Can Survive Fintech offers a survival guide for community banks and credit unions searching for relevance amidst immense global competition and fintech startups.
Author John Waupsh is the Chief Innovation Officer at Kasasa, where he helps spearhead financial product development and implementation across hundreds of institutions.
In this guide, he draws on more than a decade in the industry to #offer clear, practical advice for competing with the megabanks, direct banks, non-banks, and financial technology companies.
Fintech: Financial Technology Beginner Guide CherryTree Style
by Mark Jobs
FinTech, or financial technology, a financial technology service industry, is defined as “innovation in financial services” by National Digital Research Centre. With $ 138 billion market opportunity in the United States, FinTech has become a hot topic for entrepreneurs, visionaries and investors. However, with it&8217;s rapid growth, little in-depth information can be found regarding to FinTech, especially the relationship between FinTech and wealth management.
Fintech: Financial Technology Beginner Guide CherryTree Style aims at demystifying fintech, providing a comprehensive overview of the industry, the impact of fintech in different sectors, the leading fintech players, among other things.
Blockchain: Blueprint to Dissecting The Hidden Economy!- Smart Contracts, Bitcoin and Financial Technology
by Tony Scott
Blockchain: Blueprint to Dissecting The Hidden Economy!- Smart Contracts, Bitcoin and Financial Technology provides informative and easy tips that will let you know everything you need to know about the hidden economy and how to capitalize on this amazing technology.
The book covers blockchain technology, smart contracts, fintech, among many other topics.
It breaks training down into easy-to-understand modules and starts from the very beginning of blockchain, so you can get great results – even as a beginner.
Digital Banking Tips: Practical Ideas for Disruptors! 2nd Edition
by Tolga Tavlas
Developing a digital banking presence is a daunting task, especially when you consider the financial resources and education needed to achieve telephone, online, mobile, and other digital banking capabilities.
Digital Banking Tips: Practical Ideas for Disruptors! 2nd Edition is a quick and easy read that provides you with tips that are simple to implement, and which will help you through the process.
Even if your company has been offering digital banking services, this book can help you build out that part of your business further by assisting with areas such as identifying users&8217; needs, increase usage, improve systems, multi-channel business needs, among other topics.
Blockchain: The Comprehensive Guide to Mastering the Hidden Economy
by Timothy Short
Blockchain: The Comprehensive Guide to Mastering the Hidden Economy provides you everything you need to know about blockchain technology including how it was created and where it is likely to be headed in the near future.
You will also learn how to tell if a blockchain distributed database can replace your current database as well as how to create one and common mistakes to avoid while doing so.
In this book, you will find:
- Arguments against blockchain and how and why they are misguided
- The best ways to put blockchain to use for you
- The many impressive uses for smart contracts and even how to make your own
- And much more…
Frontiers of Financial Technology: Expeditions in future commerce, from blockchain and digital banking to prediction markets and beyond
by David Shrier (Author), Alex Pentland (Editor)
Financial technology innovation has exploded in the popular consciousness, and promises a radical transformation of the global financial services industry. Over US$ 20 billion is expected to be invested in fintech projects in 2016.
MIT Professor Alex Pentland is joined by fintech intrapreneur and educator David Shrier in curating an exploration of several major trends and technologies that are changing the face of financial services.
Co-authors include Deven Sharma, the former President of S&P, and Alex Lipton, the former head of quantitative analytics for Bank of America Merrill Lynch.
From blockchain to artificial intelligence, this series of articles helps the reader grapple with this exciting area of technology innovation.
Blockchain: Quick Start Guide to Understanding Blockchain, the Biggest Revolution in Financial Technology and Beyond Since the Internet
by Seth Ramsey
Blockchain is a revolutionary technology that was created for bitcoin, but has since found a wide variety of other applications from ecommerce and retail, to securing health care records, to maintaining all kinds of important databases.
Chances are your life has already been impacted by a blockchain database. The influence of blockchain continue to grow exponentially in the coming years, leading some people to call it the greatest technological revolution since the internet.
Blockchain: Quick Start Guide to Understanding Blockchain, the Biggest Revolution in Financial Technology and Beyond Since the Internet provides a quick start to understanding how blockchain technology works. The book explores the opportunities and challenges related to distributed ledgers and what&8217;s to expect in the future for the technology.
Fintech: Financial Technology &8211; 2 Manuscripts &8211; Bitcoin & Blockchain
by Luke Sutto
Fintech: Financial Technology &8211; 2 Manuscripts &8211; Bitcoin & Blockchain combines two books:
Bitcoin Trading &8211; A Complete Beginner&8217;s Guide
Bіtсоіn Trаdіng: A Beginner’s Guіdе to a Strategic Trading & Invеѕtіng offers іnѕіghtѕ into this vital subject mаttеr rеlаtіng to financial іndереndеnсе. Thіѕ book рrеѕеntѕ an exploration into thе іntrісаtе but profitable wоrld оf Bіtсоіn trаdіng thrоugh аn еxрlісіt аnаlуѕіѕ оf the nіttу-grіttу as wеll аѕ expounding on its mоduѕ operandi ѕо as tо bеttеr еduсаtе trаdеrѕ аnd investors аlіkе оn thе bеѕt роѕѕіblе wауѕ tо mіnіmіzе thеіr rіѕkѕ whіlе аt the same tіmе, rеwаrdѕ аrе bеіng mаxіmіzеd.
Blockchain &8211; A Complete Beginner&8217;s Guide
Bitcoins as a game changer have virtually set people&8217;s imagination into flight. Bitcoins are based on the blockchain technology. Increased exploration of the further uses of blockchain technologies have showed that there is immense promise in blockchain technologies.
The post 12 New Fintech Books To Offer This Christmas appeared first on Fintech Schweiz Digital Finance News – FintechNewsCH.
According to reports from Techfluence, there are currently some 64 robo-advisors in Europe, with the two predominant markets being Germany and London, with 23 and 13 platforms respectively. The two locations are followed by Zurich and Paris, with four platforms respectively.
In Germany, the rise of robo-advisory has been largely fuelled by incumbents which have been deploying numerous products to serve retail investors. Notably, the launch of VisualVest by Union Investment was one of the first independent moves by one of the established institutions into the robo-advisory field.
Launched as a corporate startup, VisualVest provides a platform offering retail investors access to more than 13,000 investment funds via 14 different portfolios: the so-called VestFolios.
Other examples include Fintego, a service provided by Commerzbank&8217;s subsidiary ebase, as well as comdirect, which started offering automated portfolio advice as well.
As for Deutsche Bank, the financial institution has entered into a cooperation with FinCite to offer its maxblue AnlageFinder. AnlageFinder offers a selection of securities in the respective asset class based on criteria selected by the client, such as rating, product costs and performance.
UBS and Robo Advisory
Not far from Germany, Swiss bank UBS is set to launch a new online wealth manager in Britain in early 2017. The service, called SmartWealth, will target a younger audience.
UBS is the largest wealth manager in the world, managing US$ 2 trillion in client assets. Initially, UBS SmartWealth will be available to a small number of UK residents.
UBS&8217; Shane Williams, the co-head of UBS SmartWealth, told Business Insider in a recent interview that the decision to launch in the UK was influenced by the relative high affluence of the population, favorable local regulation and the advice gap.
But the firm plans to expand internationally in the future.
“We&8217;ll look at where the best places in the future are to go but we&8217;ve not decided yet. But the design of the platform is there ready to move, whether that&8217;s language or different regulatory requirements,” Williams said.
UBS SmartWealth was created especially for those who don&8217;t meet the £2 million asset minimum of UBS&8217; current wealth management clientele. With £15,000, an investor can sign on to SmartWealth. Similarly to other robo-advisors, the platform culls the investor&8217;s goals, assets and risk threshold before suggesting an investment portfolio.
One of UBS SmartWealth&8217;s unique features is that the platform offers users a choice between an active or a passive investment approach. The active approach scours the globe for investments and strives to outperform the market. This strategy makes changes based upon UBS corporate research that includes economic and other factors. The passive approach employs lower cost UBS index tracker and smart beta funds.
As of the fees, UBS SmartWealth is set to charge 1.7%! of assets under management for the actively managed approach and 1%! for the passive one.
It took a year to build the SmartWealth platform, Williams said. Today, the team is made of 80 people based in London.
&8220;What we tried to do with SmartWealth is to be like a #fintech, to go at that pace but within a large organization,&8221; said Williams. &8220;It&8217;s trying to get the best of both worlds.&8221;
UBS is one of the numerous #banks that are looking to tap into the growing popularity of robo-advisors. In the UK, still, Barclays has recently launched a digital investment product that promises lower fees than historical investment services. Lloyds and Santander UK are also reportedly developing their own robo-advisors.
The post Germany&8217;s Robo-Advisory Sector Is Getting Crowded appeared first on Fintech Schweiz Digital Finance News – FintechNewsCH.
Im Rahmen dieser Studie im Auftrag des Bundesministeriums der Finanzen wurden erstmals Daten zu den Marktvolumina deutscher #FinTech-Unternehmen für den Zeitraum von 2007 bis 2015 erhoben und eine Prognose für die zukünftige Marktentwicklung erstellt. Die Marktentwicklung wurde für acht FinTech-Teilsegmente für die Jahre 2020, 2025 und 2035 prognostiziert. Die wichtigsten Ergebnisse der Studie sind:
– Insgesamt wurden 433 FinTech-Unternehmen mit einer Geschäftstätigkeit in Deutschland identifiziert. Davon wiesen 346 eine aktive Geschäftstätigkeit auf. Die verbleibenden 87 Unternehmen waren entweder vor 2016 noch nicht aktiv oder hatten ihre Geschäftstätigkeit bereits eingestellt.
&8211; Eine allgemeingültige Definition des Begriffs FinTech ist nicht möglich. Aus diesem Grund wurden verschiedene Marktsegmente definiert. Die Studie fokussiert sich auf die Segmente Finanzierung und Vermögensmanagement. Zu diesen FinTechUnternehmen zählen unter anderem Internetportale für Crowdlending und Crowdinvesting aber auch Social Trading und #Robo Advice.
&8211; Im Jahr 2015 betrug das Gesamtmarktvolumen der in Deutschland tätigen FinTechUnternehmen in den Segmenten Finanzierung und Vermögensmanagement 2,2 Mrd. EUR. Dabei wurden Finanzierungen im Wert von 270 Mio. EUR über CrowdfundingPlattformen vermittelt und Vermögen von über 360 Mio. durch Social-TradingPlattformen und Robo-Advice-Anbieter verwaltet
&8211; FinTechs im Segment Zahlungsverkehr konnten zudem ein Transaktionsvolumen von 17 Mrd. EUR verzeichnen.
&8211; Rund 1,2 Mio. Deutsche nutzten 2015 unabhängige Personal-Financial-ManagementSysteme zur Verwaltung ihrer persönlichen Finanzen
&8211; In fast allen FinTech-Segmenten wurden in den vergangenen Jahren sehr hohe Wachstumsraten beobachtet. Mit mehr als einer Verzehnfachung des Marktvolumens verzeichnete das Teilsegment Robo Advice die größte durchschnittliche jährliche Wachstumsrate. Aber auch Social Trading und Crowdinvesting wuchsen mit durchschnittlichen jährlichen Wachstumsraten im dreistelligen Bereich.
&8211; Das Volumen der potenziell adressierbaren Märkte der FinTech-Segmente Finanzierung und Vermögensmanagement wird in Deutschland für das Jahr 2015 auf knapp 1,7 Bio. EUR geschätzt. Diese Zahl setzt sich aus einem Marktvolumen von rund 380 Mrd. EUR im Segment Finanzierung und etwa 1,3 Bio. EUR im Segment Vermögensmanagement zusammen. Die Studie geht im Basisszenario von einem Anstieg des FinTech-Gesamtmarktvolumens auf 58 Mrd. EUR im Jahr 2020 und auf rund 97 Mrd. EUR im Jahr 2025 aus. Im Jahr 2035 könnte der Markt im Basisszenario sogar ein Volumen von bis zu 148 Mrd. EUR erreichen.
&8211; Insgesamt 87 % der befragten Banken kooperieren derzeit mit einem FinTechUnternehmen und streben auch zukünftig eine Beteiligung oder Kooperation mit FinTech-Unternehmen an.
&8211; Aktuell gehen keine systemischen Risiken von den FinTech-Unternehmen in Deutschland aus. Sollte das dynamische Wachstum der FinTech-Branche weiter anhalten und das sehr große Wachstumspotenzial ausgeschöpft werden, könnten sich jedoch systemische Risiken entwickeln
&8211; Innerhalb Europas liegt der deutsche FinTech-Markt nach Großbritannien auf dem zweiten Platz. Auch im globalen Vergleich hat Deutschland in den letzten Jahren zunehmend aufgeholt.
Die deutsche FinTech-Branche befindet sich in einem sehr schnelllebigen und dynamischen Umfeld mit einer Vielzahl unterschiedlicher Geschäftsmodelle. Wie in allen Branchen mit einem hohen Start-up-Anteil ist davon auszugehen, dass sich nicht alle jungen Unternehmen mit ihren Innovationen am Markt durchsetzen können. Zweifellos werden diese Lücken durch andere, neuartige Ideen und Geschäftsmodelle gefüllt.
Diese Studie beschreibt die aktuellen Trends und Wachstumstreiber, die die Branche in der Vergangenheit beeinflusst haben und gibt einen Ausblick auf zukünftige Wachstumsimpulse und Hindernisse.
Die Studie kann hier eingesehen werden. Der Text ist eine Zusammenfassung der Studie, welcher sich ebenfalls auf dieser Seite befindet.
Featured Image: via Pixabay
The post Studie zum Deutschen FinTech-Markt appeared first on Fintech Schweiz Digital Finance News – FintechNewsCH.