Disruptive Opportunites in Digital Banking go beyond fintech
The banking industry is going to look a lot different in 10 years time. Many
traditional players now face the choice of either being disintermediated or
proactively disrupting their own business models to thrive in the future.
Disruption in banking is a topic du jour. Not surprising perhaps, if one
considers the prevailing belief among Silicon Valley start-ups and the banking
industry cognoscenti alike—that “fintech” firms are about to disrupt banking
for the better. While all the disruptive opportunities in banking stem from the
basic concept of mixing two things- Finance and Technology, they branch out
to become unique platforms for consumer services.
In this article, we will talk about one such disruption- Stripe. “Stripe Capital
makes it easy for internet businesses to get the funds they need when they
need them,” Stripe’s Chief Product Officer Will Gaybrick said in a
statement. Stripe is a technology company that builds economic infrastructure
for the internet. Businesses of every size – from new startups to public
companies – use our software to accept payments and manage their
In short, stripe is trying to increase the GDP of the internet.
The potential of the online economy
Despite internet businesses growing faster than the rest of the economy, only
about 3 percent of global commerce happens online today.
Regulatory complexity, a complicated global financial system, and a shortage
of engineers are constraining the impact of the internet economy.
Removing the barriers to online commerce helps more new businesses get
started, expedites growth for existing companies, and increases economic
output and trade globally. This can lead to a global market expansion that
will go far beyond one’s imagination.
Many banks and capital markets firms, particularly the large, complex
institutions have been simplifying their business and operating models over
the last few years, both for economic reasons and to reduce organizational
complexity. There is an increasing realization that they do not or cannot excel
at every activity, and that it may be easier and cheaper to outsource noncore
In the new organizational paradigm, maintaining an organizational identity
and creating a cohesive culture and employee loyalty when most of the talent
is not in-house will be an entirely new challenge. In our view, a more global
“ex-force” (external talent) will necessitate greater cultural sensitivity and the
willingness to be more flexible with work protocols.
Thus taking into account the possibility of microloans, as well as macro loans,
becoming relatively faster, easier and accessible. The traditional banks will
have to redefine and reintegrate themselves in order to survive.
Do you think that the creation of easier and more accessible platforms for
banking and lending are worth the possibility of the slow death of traditional banking and lending?