This is the fifth interview in The Braintrust series, where we find leaders in the FinTech and bank disrupting space and have them share their expertise with our members.
Over the course of the 2010s, FinTech startups successfully changed the face of banking and finance. Disruptive startups like Stripe, Robinhood, SoFi, and Credit Karma completely altered what customers expected from their financial services. Over the last few years, the large incumbent banks have finally begun to follow FinTech’s lead.
Marcel van Oost is a FinTech strategist and advisor based in Amsterdam. He sits on a very interesting perch from which to see the future of finance and banking. We asked him to use his view to forecast this next decade. Where does he see as the biggest opportunity center for challenger banks over these next 10 years? His answer may surprise you.
Unifimoney: In ten years, do you expect that there will be new incumbents in the banking world? Or will the old incumbents have simply adopted the innovations of the challenger banks?
Marcel van Oost: I don’t think incumbents will be replaced by neobanks completely. However, they will undergo transformations, they will have a greater demand for the use of technology to become more efficient, and they will have to rethink their branches model. And I expect that most customers will have more than one banking relationship.
So, yes, I think most incumbents will adopt most of the innovations. And they have an advantage of their long-term reputation that builds trust. That will be a real challenge for these new players/neobanks to gain.
But in 10 years time the best brand will win. Who that will be I really can’t predict. But I am sure that it could be one of the challenger banks.
Unifimoney: Today, there is very little segmentation in traditional banks other than for the top 1% who have access to personal banking. Both in consumer and SMB markets, do you expect the rise of niche services tailored to specific customers in banking?
van Oost: Absolutely. You see that all over the world and in all segments. For example, neobanks targeting teens and Gen Z, and also with personal banking.
Unifimoney: How different do you expect banking to look around the world? Will the rise of digital banks lead to a further differentiation across geographical sectors, with China exclusively mobile, US fully online, or somewhere like Australia 100% cashless? If you had to predict: which country or region will have the most novel style of banking?
van Oost: Mass adoption on that next-level scale is only possible in China. For obvious reasons. It’ll be a very different challenge in the US and Europe.
If I have to make a prediction, Latin America has a big chance of mass adopting digital products because there have been so many people under banked, or even unbanked. Masses of people can now get access to digital banking and payments options that can really make a difference in their lives and their economy. Although cash will also stay very important for a long time, since the offerings for SMEs, for example, are very limited at this point. There is a big opportunity there for neobanks!
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