For many of us, the hub of all things financial has been, for the most part, a bank. Recently, the centrality of the bank is increasingly be called into question, as both specialized companies and money management alternatives have come to the forefront. Also, the expansion of access to information has enabled new entrants to access commercial engagements directly, creating a whole range of new businesses. In many cases these newly minted business people have not used traditional banking previously, and have little understanding of it.
Globally, 42 percent of consumers have used non-bank providers within the last twelve months, and 21 per cent have not yet used them but plan to do so in the near future. In certain Asia-Pacific markets, the presence of non-banks is felt even more strongly.
In mainland China for example, the stronghold local fintechs have in that market is evidenced by just 70 per cent of consumers identifying a traditional bank as their primary financial service provider, much lower than the global average of 85 per cent.
Mercator Advisory Group recognizes the way in which financial institutions operate and engage with their clients is fundamentally changing, and that change is accelerating. The web of domestic and international regulations and requirements will require expertise, information will need to be both properly disclosed and adequately secured depending on the situation. Knowledge will increasingly be the asset traditional banks will leverage to carve out their role in the global economic model.
Overview by Joseph Walent, Associate Director, Customer Interaction Advisory Service at Mercator Advisory Group
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