In a relatively short time, fintechs have become an established part of the financial services environment. The fast pace of innovation within the sector, allied with fintechs’ ability to understand customers’ wants and needs through data analytics, has resonated with consumers and businesses eager for customer-friendly products that speed up transactions and widen choice.

The future of fintech belongs to those organizations that can master data from across the enterprise—front to back office—to drive their decision-making. To do this, KPMG professionals believe companies will need to become “connected enterprises.” These are organizations that use data and digital technology to function more smoothly, develop innovative products, connect with customers and suppliers, and give employees the tools to succeed. A clear focus on what they do best can help ensure that technology investment is not spread too thinly, with a growing use of strategic partnerships to access new capabilities, accelerate expansion and help to reduce costs.

Signals of change

The future of fintech will continue to be defined by customer demand for speed, convenience, and choice. Traditional business models are being challenged. With apps increasingly serving as the entry point for services, the market for financial services has opened to non-traditional competitors. This paradigm shift signals a potential threat to the dominance of banks and other financial services companies, some of whom risk becoming back-office providers to major consumer/technology brands. These conditions have framed the rise of the modern fintech. 

  1. Customer: Rising demand for wider, more personalized choices and a connected experience
  2. Competition: Fintechs may need to embrace “co-opetition”-style strategic partnerships
  3. Product: Fintechs innovate to stay connected to changing customer demands and disruptive new technologies
  4. Technology: The rise of decentralized financial ecosystems
  5. Regulatory: Growing regulatory scrutiny necessitates investment in regulatory and compliance resources 
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Future of fintech

This paper considers some of the key signals of change in the market, and the types of business models likely to emerge, as financial services companies—particularly banks—ponder whether to “own” the customer interface or to act as providers to other companies that offer a wide range of products in addition to financial services.

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KPMG Connected Enterprise

KPMG professionals can help you harness technology to build a connected enterprise. That's an enterprise where your front, middle and back offices are aligned. An enterprise where you're more connected with your customers, employees and business partners. An enterprise that enables you to respond quickly to market signals and pivot to help seize opportunities as they arise.

KPMG Connected Enterprise is a digital transformation approach, that’s industry-specific and customer-centric. It helps focus critical processes, functions, and relationships of a business on meeting customer expectations, creating business value and driving sustainable growth in a digital world.

Organizations that invest purposefully in these capabilities are twice as likely to meet customer expectations, achieve their objectives and deliver return on investment.*

You can discover how connected your organization is by using the diagnostic tool. It assesses you against industry best practice and highlights the opportunities and challenges that may affect your ability to become a connected enterprise.

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Strategic approaches for your business

From startups to Fortune 500 companies, technology and fintech companies worldwide aim to secure their market position through disruptive innovation. As new technologies are adopted around the world, it has become increasingly important for the leaders in these sectors to understand the complexity and business transformation impact of rolling out new products and services. KPMG’s technology professionals understand this changing and challenging environment. They combine industry knowledge with technical experience to provide insights that help technology leaders deal with their complex business models. KPMG professionals go beyond today's challenges to anticipate the potential long and short-term consequences of shifting business, financial and technology strategies.

Learn more about the Technology Practice and Fintech Practice or contact a KPMG professional who is ready to help you address new challenges and drive growth.

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Christine Chan

Advisory Managing Director

KPMG in the U.S.

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