7 out of 10 CIOs in banking and securities tell us that digital entrants (Fintech) from outside their industry are a greater threat than their usual competition. Fintech threatens vendors who serve banking and securities also, not only their clients. Interest in Fintech is evident everywhere, but not in the strategy of the vendors who serve banking and securities. Gartner’s analysis shows that vendor responses lag behind the interest shown by their clients, investors and the new Fintech services. Most vendors are still not sure if Fintech is a friend or a foe and have only tepid responses. While there are reasons galore why they have been cautious – lack of clarity of the Fintech market, little evidence of impact on bank revenue and competitor inaction – those do not justify absence of preparation as such clarity may never arrive or will be too late when it does. It is time for vendors to prepare their strategic response to Fintech, both to shield their current businesses as well as to take a spear to new opportunities.
In the recent Gartner research note – “Market Insight: Banking and Securities Industry Playbook — Six Steps TSPs Must Take Now to Address Fintech”, we provide 6 steps that business leaders at vendors need to take now to address Fintech in their segmentation and product strategies. Another recent note, the “Cool Vendors in Consumer Financial Services, 2016”, provides some of the innovative vendor solutions that address the Fintech market. This is Gartner’s third annual cool vendor note on consumer financial services.