FinTech and the Average Person

FinTech and the Average Person by Yvonne de Ville

FinTech has been revolutionising the way people and business owners manage their finances and you can make the most of the mobile apps, tools and services that are now available to simplify your lifestyle. Compared to traditional banks that limit you to the products that they offer and their opening hours, FinTech products and services offer the user so much more and they are available to users 24 hours a day and 365 days a year.

Here are some statistics that you may be interested in:

·??????The UK FinTech market is expected to reach GBP 12.8 billion in revenue in 2022/23.(1)

·??????There are 2,275 businesses that employ 86,778 employees in the UK in 2022. (1)

·??????71% adoption rate of FinTech in the UK (the world’s adoption rate is 64%) in 2020. (2)

·??????80% of adults have a smartphone in the UK as of 2020. (2)

·??????The top 4 FinTech companies in the UK (2018) are (a) TransferWise, (b) Funding Circle, (c) Revolut and (d) OakNorth. (3)

How is the average person affected by the new FinTech products? These FinTech solutions are available on desktop computers or smartphones. Before the introduction of smartphones, there were already FinTech products like automatic teller machines that were available to everyone. However, Smartphones have given the average person greater access to more FinTech products. Smartphones have made it for the average person to be able to access a greater range of financial products and services such as payments, investments, peer-to-peer lending platforms, cryptocurrency, digital wallets and so forth.

However, there is a large stumbling block to the acceptance of this new technology. The younger generation is tech-savvy and smartphone savvy, but the stumbling block lies with the older generation (anyone over the age of 45 years) who are not as savvy and are far behind in the use and knowledge of this new technology. This group of people has not been able to grasp the basics of using their phones for banking transactions and other payment functions. We are starting to see a change in recent years with the average person in the older generation slowly starting to transition towards this new technology as they start to gather knowledge and realise the benefits.

London is considered to be the superhub for FinTech with respect to businesses, employees and users, but there are other centres throughout the UK that are developing FinTech solutions. (4) From the average person’s perspective, the reach of these FinTech solutions is not just limited to major cities but has extended beyond major cities to regional areas providing there is access to an internet service.

Apart from the speed, simplicity and convenience provided by these FinTech solutions, they can help the average person make better financial decisions. FinTech solutions provide access to more analytical tools and data so that people can better understand their finances easier and then make better decisions. The average person can develop a budget centred around their income and spending habits. They can use the data and analytical tools to help them to manage their budgets and to control excessive spending habits.

Here are some of the ways that you can enjoy the benefits of FinTech solutions on your smartphone or desktop computer:

·??????There are significantly more payment processors and peer-to-peer payment platforms for you to make payments to your family and friends any time of the day or night from the comfort of your home or office.

·??????You can track and control your spending habits easier.

·??????You can start building your future wealth by creating your investment portfolio. You can start investing small amounts of money into financial investment products so that you are putting your hard-earned money to work rather than the funds sitting idle in your bank account earning 0% interest and absorbing excessive bank fees.

·??????Each person has a different investment appetite and different risk levels. There are more financial investment products available through FinTech such as cryptocurrency and digital currencies. The average person can easily make investments in gold and index funds.

·??????FinTech products and services charge lower fees compared to traditional bank fees.

·??????The average person has access to lending products via these platforms.

The Future of FinTech for the Average Person

FinTech solutions have come a long way so far, but it is not expected to stop there. It is expected that the industry will continue to grow with more solutions becoming available across different industry sectors too. With the huge adoption rate of FinTech solutions in the UK, the average person can expect to see more financial products and services coming to the market in the future. Most solutions will be available on smartphones and will become more secure. It is expected that these solutions will become more personalised to meet the demands of the users.

Traditional banking institutions will need to quickly accelerate their transformation toward developing digital financial products and services otherwise they will quickly lose their position in the marketplace.

“Financial institutions must be able to deliver an easy-to-navigate, seamless digital platform that goes far beyond a miniaturized online banking offering.” Jim Marous Mirror Review Quotes

References

(1) IBISWorld. Financial Technology in the UK - Market Research Report. Source: - https://www.ibisworld.com/united-kingdom/market-research-reports/financial-technology-industry/

(2) The Global City. The UK: Innovation Hub for FinTech. Source: - https://www.theglobalcity.uk/PositiveWebsite/media/Research-reports/CoL-Global-City-Factsheets-Fintech.pdf

(3) Robert Walters. The UK Fintech Revolution. Source: - https://www.robertwalters.co.uk/content/dam/robert-walters/country/united-kingdom/files/whitepapers/RW-VacancySoft-Fintech-Market-Report.pdf

(4) Deloitte. The UK FinTech Landscape. Source: - https://www2.deloitte.com/uk/en/pages/financial-services/articles/uk-fintech-landscape.html