Forbes: ready to embrace change: financial technology and wealth of five hundred strong


nnnWalking Comments: Block chain technology has caused the attention and support of traditional financial companies, perhaps cooperation, acquisitions, or investment. Predict the prospect of financial technology companies. According to the survey, the traditional financial companies still captured the hearts of most consumers. Therefore, this form, not only for financial technology start-up companies and traditional financial companies to develop their own interests, consumers can also rely on financial services agencies have been relying on new technical support.n
nnTranslation: Annie_Xun
nIf you think the biggest financial technology innovation comes from the start-up company, then in most cases you may be right. Despite the increasing size and quality of Fortune 500 financial firms, they often lack small-scale rivals that can not practice the idea of ​​”less or more”, that is, they can not take advantage of lower costs, smaller teams and at least Supervision. But traditional finance companies are also involved. Let’s take a look at these two aspects.n
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nEntrepreneurial company’s leading edgen
nFinancial technology start-up companies can do more with less reason is that they do not have large financial institutions, the legacy of infrastructure and existing compliance issues. Small teams can focus on rapid modeling and minimal viability of products, reducing creative time to product release, resulting in a rapid market strategy. In addition, in order to increase the speed and reduce costs, they may begin to use and simplify the software version, after they spread to add new features. This process is different from the large financial companies, they focus on the product before the release of continuous improvement.n
nEntrepreneurs usually focus on a financial business and to improve, and Fortune 500 financial companies have a lot of business lines. So large financial companies to avoid a number of aspects of their bottom line attack. Such as PayPal, Stripe and Square, while considering payment processing, Betterment and Wealthsimple and other robot consultants to explore a large area of ​​health management opportunities.n
nMore than that. The latest financial and technology participants are venturing into the consumer loan market where LendingClub and SoFi are located; Kabbage and OnDeck Capital want to be a leader in small business loans, and the high cost of loan processing has led to a lack of coverage for this market. Financial technology solutions can not only make the industry profitable, but also to avoid banks and other institutions to provide loans. Keep up withn
nChanges in consumer behavior make it difficult for Fortune 500 companies and large financial institutions to meet the growing demand for financial technology solutions. So how can large-scale financial institutions strengthen their technological capabilities and avoid backwardness? The increase in investment in technology is a very natural step, and many organizations have already begun to do. 2016 SourceMedia Research Bank Chief Intelligence Officer, 70% said it would increase investment in science and technology, 1/3 will increase at least 10% of the budget.n
nBut investment technology should not be blind behavior, traditional financial companies should first determine the company’s most important business scope, not only for the protection of funds, but also for the upgrade. This can give customers a better product, increasing the attractiveness of new customers. The good news is that this is already happening, perhaps through internal innovation, perhaps through cooperation, or investing in financial technology companies, or by acquiring the most potential financial and technology rivals.n
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nInternal innovationn
nWhile most large financial firms have multiple programs to combat entrepreneurial competitors, a major strategy is internal innovation, which is the beginning of recruiting and nurturing in-house technical talent. You may have guessed that the benefit of this strategy is to better control the innovation process and get the IP. Such as Citigroup built a small business team like the start-up companies to promote the development of consumer banking business, the rapid release of new products. At the same time Fidelity released its own consumer-led digital consulting solutions Fidelity Go and consulting technology platform Wealthscape.n
nMany banks are also trying to deal with payment processing companies, such as PayPal and Square, to create their own alternatives. For example, a few years ago, some of the largest US banks have created a clearXchange network, which is now Zelle, which allows consumers to transfer mobile devices from their bank accounts to another bank account.n
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nCooperation n
nWorking with financial technology companies is another common strategy for Fortune 500 companies to lead technology trends. In 2017, the PricewaterhouseCoopers report shows that 8/10 financial companies will cooperate with financial technology companies.n
nCooperation with financial technology participants varies from company to company. For example, Santander set up a financial technology risk fund, used to obtain the minority interests of emerging technologies. Fidelity’s companies work with emerging financial technology companies through incubators and accelerators.n
nCiti invites financial technology companies to join the creation of mobile banking application API development center, the first three weeks there are more than 1,400 developers signed to join.n
nJP Morgan announced the cooperation projects over the past few years, including cooperation with online loaner OnDeck Capital and block chain company Digital Asset Holdings.n
nThese partnerships are cost savings, close focus on innovation, and protection of product chains.n
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nAcquisition companyn
nThe acquisition is also a common trend for large financial companies. In 2016 51 start-up companies were acquired, or $ 1.1 billion in financial services IPO.n
nPricewaterhouseCoopers reports that 50% of global financial services companies recognize plans to buy financial technology startups in three to five years. But this is not news, because 95% of the financial technology companies believe that the next one to two years will be acquired, or access to large financial institutions.n
nSome acquisitions have been completed, 2015 Northwestern Mutual acquires LearnVest, Goldman Sachs acquired Honest Dollar, Fidelity acquired eMoney Advisor.n
nOther companies, small-scale investment companies, may be the first step in exploring large-scale investments or acquisitions, perhaps because Goldman Sachs is interested in data analysis firm Kensho.n
nThese acquisitions not only allow companies to acquire the technology needed by the company’s core business, but also provide new channels for new customers to expand their market share.n
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nConsumers more believe who?n
nOld financial companies not only have a strong financial advantage, you can invest in innovation, cooperation and acquisition of rivals, as well as customer base, brand equity and public trust. CapGemini and LinkedIn study found that 1/4 consumers believe that financial technology companies, and 3/4 consumers believe that traditional financial companies.n
nThis means that they can not only catch up with the science and technology competition, but also can win. Whether it is internal innovation, investment opportunities or acquisitions, growth potential is real. The result is bright, that is, more consumers, more products, greater market share. It seems that the prediction of Fortune 500 companies is much better than many of the previous speculation, which is also a good thing for consumers because they can take advantage of the new technology of financial institutions that have been relying on it all the time.n

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