The advent of Fintech ( Financial Technologies) is bringing up ground breaking transformations to the world of finance for businesses and people.
Technology has now become an integral part of the financial sector and it interacts with the customers in unique ways.
A large number of innovative Fintech start-ups and technology companies have been incorporated into the financial sector including technologies such as cloud computing, machine learning, artificial intelligence and big data analytics.
The emergence of Fintech possibly results in a power shift from large Financial companies to the general population.
Fintech is opening up lots of opportunities in Ireland and its products and services have drastically changed consumer behaviour.
Consumers can now open bank accounts over the internet, link their accounts to smartphones to monitor every transaction and make payment easily through apps like Revolut.
In the future, consumers may be able to seek financial advice that is automated with little to no human interaction required.
The Fintech has its effect upon the business operations too. Organisations have alternative market places to source financing, such as peer-to-peer lending marketplaces, such as Prosper, LendingClub and OnDeck.
Car insurance businesses now offer consumers telematics-based insurance policies where your driving is monitored using data collected via a ‘blackbox’ that is fitted to your car or via your smartphone.
The data collected is used to calculate your premium.
The financial activities of Irish Fintech companies have been on rise, according to KPMG’s latest report with $328.6m recorded in VC, PE and M&A transactions across eight deals.
This represents double the value of comparable transactions in the Irish Fintech sector for the entire year in 2019.
Enterprise Ireland and Ernst and Young’s 2018 report found that there are over 7,000 people working in the Irish Fintech sector with this figure expected to rise to 10,000 by the end of 2020 (A&L Goodbody 2019).
Despite all the progress market is facing the lack of skilled workers. PwC’s 2019 CEO survey found that the skills deficit is more in Ireland than globally, with 84% of CEOs in the Irish financial services sector concerned about the availability of key skills, compared with 76% globally.
Professor Martin Crane is leading the new MSc in Fintech and Technology Innovation at DCU.
In his opinion the emergence of Fintech brings a power shift from those who have held it hitherto towards the general population and thus democratize Aggregation, Micro Investing and Crowd -funding. He also said that it empowers companies in Payment Services and Regulatory Compliance by simplifying and automating their processes.
Talking about the scope of Fintech, he noted: “It has been developed to deliver the requisite Fintech background knowledge in key underpinning areas such as Data Governance and Financial Time Series as well as technologies necessary for developing Innovative Fintech technologies e.g. AI and Blockchain”.