In the past few year, the concept of financial technology has taken off around the globe, helping many consumers better manage their funds.
Do these services have an application in strategic management or is it solely a trend for the consumer market?
Adoption of FinTech to double over 2016
According to a recent survey from Ernst and Young (EY), digitally active consumers are starting to look into new FinTech products . Out of the 10,131 surveyed across six countries, including Australia, 15.5 per cent have used at least two FinTech services. Out of the group who have never used a single FinTech product, 53.2 per cent had not heard of the concept.
In the past three years, the value of global FinTech has tripled.
EY Australia's FinTech Leader Anita Kimber explained the benefits of utilising this innovative technology and the buzz amongst consumers looking to invest in the product.
"The increasing availability of innovative, competitively priced products provided by the new FinTechs shows that consumers are willing to shop around and experiment," she said.
As FinTech continues to catch on, traditional financial services companies will have to reassess their view of what consumers are looking for in a digital age and step up their efforts to serve them effectively."
A report from KPMG stated that in the past three years, the value of global FinTech has tripled, representing US$3 billion. These services are disruptive, creative and tuned into the needs of the modern consumer. However, the report also mentioned that businesses engaging in FinTech will be more likely to succeed in the modern era of business.
Can FinTech be applied to business strategy?
Although FinTech developments have focused on the regular consumer, businesses could take advantage of the latest innovations, according to a report from the World Economic Forum (WEF).
WEF stated that small businesses around the world often struggle to properly manage their finances. The issue is rather complex, but some of the reasons that the WEF highlighted included the limited services from banks and the low scale yet multi-faceted nature of finance in this structure.
Smaller businesses also have less resources available to address these issues, which means they can only invest in a system that offers a good rate of return.
Of course, there are plenty of ways that small businesses can utilise technology in strategy execution. Seeking out the most valuable methods of dealing with finance will be a wise choice for small businesses looking to grow in 2016.