miércoles, 11 de mayo de 2016

#Fintech : The final disruption

Although digitalisation is changing things  around us, we have not seen the big disruption yet. We have seen how the transport or entertainment have passed through radical changes, but those and other cases are isolated sectors and many other activities are still being developed like 20 or 30 years ago. The point of no return in digital transformation would be a digital disruption with transversal impact in all the social and economic activities. This great disruption is under development and it is called fintech.  

Fintech will be something more than the digital disruption of the financial sector. Firstly, all our activities have in the base the access to capital and money is the main payment method for acquiring products and services. Fintech startups are making easier both at the same time and, therefore, they have the potential to change how we are developing all our activities. 

Secondly, the announced end of work, the replacement of workers by machine and algorithms, will have the digitalisation of the financial sector as one of its main sources. Let´s take only the banking subsector, one of the main source of stable work posts. It is estimated that 60 to 70 percent of retail banking employees are doing manual-processing-driven jobs. The consequence of digitalisation on the banking sector jobs will be the disappearance of more than 1/3 of its posts in 10 years.

Lastly, the spillover of financial sector digitization will bring the reduction on the demand of many services. To begin with, there will be a significant decrease in the number of branches. This will mean pressure on real estate activities in every corner of our cities and all the world services and retail commerce that flourish around the bank branches.

Fintech has the potential to be the final disruption for the pre-digital society. It will change how we develop all our activities, it could be the model for the transition to a society scarce of jobs and it will have an unpredictable spillover on other physical activities. The ingredients are now on the pot.

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