Financial institutions to be transformed into IT businesses within 10 years

Finance professionals expect the economy to look completely different within the next 10 years as over two-fifths (43%) believe financial institutions will be transformed into IT businesses within a decade, according to Onguard’s FinTech Barometer, a survey of over 1000 finance professionals.

Over half (59%) are also convinced that the way in which we pay will have fundamentally changed within five years.

Collaboration with fintech companies

The arrival of tech giants who are gradually taking over payment traffic from banks means that the role of financial institutions is constantly shrinking. These institutions are therefore working to develop innovative software (28%) or seeking out collaborations with innovative startups in the field of fintech. One-fifth of the organisations (20%) are already working with one or more startups. Another 14% indicate that they are closely monitoring developments in the fintech market.

But finance professionals are finding that developments are increasingly rapid and hard to keep up with. Over a third of them (36%) are struggling to keep up with developments within the financial world. What is notable is that the vast majority of professionals in financial services believe that their current employer will still exist in ten years’ time (74%). However, this may be in a different form as 47% of those surveyed anticipate that new technologies, such as robotisation, will result in far fewer jobs in the financial sector. Nonetheless, the majority are not worried that their own job will disappear with 87% saying they expect their current role will still exist in ten years’ time.

Marieke Saeij, CTO at Onguard, says: “We are living in a platform economy in which financial institutions are increasingly entering into collaborations with innovative parties, and where digital transformation is taking place rapidly. As a result, financial institutions are making more and more use of IT. We are therefore not surprised by the prediction that they will transform into IT businesses within the next decade. The fact that the majority of finance professionals are not worried about the disappearance of their own job is also justified. Although many processes can be automated, people will always be required to control these processes and actually speak to the customer.”