Fintech explosion puts banks in digital firing line

www.reuters.com

Interesting article drawn from a recent WEF report, summarising the challenges startups are presenting to banks and insurance companies. _The generation born after 1980 have largely abandoned bank branches already. Younger people turn instead to virtual fintech brands such as eToro for social-media style investing, Moven in mobile banking, Prosper for loans and a growing number of crowd-funding platforms to finance projects. [...]_ _Bankers who once thought financial regulation was a barrier to new entrants are seeing non-bank fintech rivals go after their most profitable markets, while avoiding regulated pieces of business. Most of new fintech firms selectively partner with technology providers who possess their own banking licenses, rather than waiting to procure banking licenses in country after country. They partner and outsource much of the underlying technology they use, slashing costs, while boosting flexibility._ _While challenges to banking are more imminent, insurers may face bigger threats in the long-run as troves of online data usher in new types of personalized health, life and drivers insurance, upending the model of mutualized financial risk that has been at the heart of the industrys._ The full WEF report can be downloaded [here](http://www3.weforum.org/docs/WEF_The_future__of_financial_services.pdf).

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