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Callsign 2020 Predictions: More FinTechs Will be Made Redundant

VMblog Predictions 2020 

Industry executives and experts share their predictions for 2020.  Read them in this 12th annual VMblog.com series exclusive.

By Stuart Dobbie, VP of Product at Callsign

In 2020, More FinTechs Will be Made Redundant

To date, FinTechs have done a fantastic job at bringing their users a solution with great user interface (UI), great user experience (UX) and easy access. But that doesn't mean their offering is overly unique. Ultimately, modern banking is still a (relatively) boring product space and the underlying financial product offerings have not changed much beyond checking accounts, savings and investment products.

The traditional enticements of brick-and-mortar banks - introductory offers or lifestyle subscriptions -- have been largely leveraged by FinTechs and NeoBanks. Some of these include recommendation kickbacks and wholesale prices (avoiding transaction fees abroad) alongside 100% remote banking and nice user UI, which has allowed them to attract a younger generation at scale. Similarly, the use of artificial supply and demand (application queues) with strong branding and marketing has enabled huge surges of initial growth.

Users also benefit from a streamlined onboarding journey and the ability to manage their new account with much greater detail (e.g. slice and dice analytics, recommendations and predictive budgeting). However, like we've seen with social media platforms in past years, eventually the novelty wears off and it becomes apparent that many of these "unique" offerings are the same.

For FinTechs in 2020, it will be interesting to monitor how quickly loyalty - induced by strong branding and convenience - recedes with populism and the commodification of application features for the purposes of increased revenue streams.

Likewise, the challenge of developing and maintaining brand trust will require UX beyond application interactions. Many of these new FinTechs have yet to reach the critical mass whereby, when everything goes wrong, the ability for a "physical" sympathetic ear may still be the best line of recourse to ensure customer satisfaction especially with defaults, fraud and technical issues.

Given these complexities faced by FinTechs, I predict many more will be brought in-house to traditional banks. And the FinTechs that succeed will be those that work with or are developed from within the traditional banks.

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About the Author

Stuart Dobbie 

Stuart Dobbie is Vice President of Product at Callsign. Callsign solves challenges that organizations face in getting their users on to and interacting with their digital platforms easily and securely. We provide solutions to some of the world's largest banks and offer "bank grade" identification to public and private sector clients of all sizes.

Stuart has a career history in the Financial Technology sector where he has been a Delivery Leader and Subject Matter Expert with a strong focus on fraud detection, security and the application of AI technologies and big data systems to the aforementioned problem spaces. Stuart is most motivated by the application of nascent technologies to previously unsolved operational and market problems. He has further interest in criminal theory and technology policies, and holds an MSc in Criminology and Criminal Justice from the University of Edinburgh, alongside a Bachelor of Laws from the University of Glasgow.

Published Friday, December 27, 2019 7:46 AM by David Marshall
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