Fintech Business Models [PDF]

Zitiervorschau

Emerging Fintech Business Models

A closer examination of few business models that are reshaping the financial landscape

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Overview Previously, financial technology served as a back-office support function for bankers and traders. Venture capitalists made only a few investments in the sector. The industry's public companies were rarely compared to the high-growth darlings of Silicon Valley. But everything has changed. Private venture capital has skyrocketed in the last decade, with the share of investment dollars going into fintech increasing from 5% to nearly 20%. Fintech has established itself in the innovation economy.

New take on old lending categories through digital decision-making ●

The now-public LendingClub with personal loans

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Bread and Affirm paved the way for POS financing

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Square Capital’s focuses on merchant cash advances

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Prosper and Avant offer personal loans

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SoFi has expanded from student loans to personal loans

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Tradeshift is taking on supply-chain

Mobile-only lending as an example of underwriting innovation ●

Tala and Branch both seek to offer microlending over mobile devices in developing countries

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The US-based companies make real-time loan decisions dynamically by using every piece of information they can gather from the customer’s mobile phone; public reports note that the companies use ○

Text messages

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Contacts, and

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Hundreds of other data points to make underwriting decisions

Demographic-focused products A new set of companies are developing demographically-focused products. They segment not only from a brand and marketing perspective, but from a product innovation perspective as well. ●

True Link Financial’s elder fraud protections

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Finhabits’ saving focus for Latino’s

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Camino Financial’s lending for Latino-owned small and medium size businesses

Blockchain for infrastructure cost reduction A new generation of blockchain firms are focussing on specific use cases to improve the cost and functioning of core infrastructure. ●

R3, Symbiont, and Blockstream are all working on general solutions

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while The Interface Financial Group and ConsenSys are targeting supply chain

The Wildcards: Tech companies in Financial services Banks are data and technology companies. Recordkeeping and ledgering, transaction tracking, identity, and predictive modeling are all fundamental concepts in both banking and software engineering.

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Apple’s launch of a credit card may represent a new phase for branded fintech experiences

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The launch of shopping on Instagram and WhatsApp testing payments in India both represent steps by Facebook into financial services

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