This story was delivered to BI Intelligence " Fintech Briefing " subscribers. To learn more and subscribe, please click here . Although many financial services firms are implementing strategies aimed at staving off disruption — including partnering with fintechs, launching incubators, and building solutions to help them better compete — new data suggests that most executives think these initiatives are not enough to protect their businesses. Eighty-three percent of UK financial services executives believe that the expansion of fintechs will negatively impact their ability to maintain or grow market share over the next 12 months, according to data from Robert Half. Here are the study’s other key findings: Direct competitors are perceived to be the biggest threat. Twenty-six percent of executives believe that online investment firms are most likely to cause disruption to incumbents over the next year, while 24% said it would be digitally focused challenger banks. These fintechs most closely resemble existing institutions and provide a wide array of services, making them a threat to multiple areas of business for legacy banks and investment firms. Financial services firms are seriously worried about competition for talent. Ninety-one percent of executives believe that the growth of the fintech industry will negatively impact their ability to attract new employees, while 83% are concerned about losing staff to fintech competitors. This concern was recently echoed by HSBC’s head of digital, Raman Bhatia, who said the banks that win the war for talent will be the ones able to compete in the future. We think that these executives’ fears are largely unfounded, and that in the future, we will see more partnerships between incumbents and fintechs. Eventually, we expect to witness the acquisition of these fintechs by incumbents, once it’s been ensured that the new technology and business models work. This will […]
