Why fintech is still a way off disrupting lending

Great article at the end of last week in Financial News London discussing why FinTech is still a way off disrupting lending.

Mostly because despite advancements in automated lending decisions it’s still very clear that most FinTech’s still rely heavily on traditional risk employees within their business to help with lending decisions on a more manual basis. It sounds like the argument is that only when FinTechs can prove they can lend on a purely automated basis, that doesn’t prove a detriment to the quality of lending decisions, will they have truly disrupted the traditional lending space!

Original article can be read here!


Top 10 FinTech predictions for 2018

We saw a great Infographic on Chris Skinners’ blog this week (although original credit goes to clari5 by Customer XPS), which talked about the top 10 FinTech predictions for 2018! Thought this could be a good way to start off the year! So here goes…

  1. Digital 2.0 Adoption Critical for Success
    US $350bn potential addition to bottom line over the next 3-5 years on complete Digitisation
  2. Enter the Machine-Led customer Front-End
    -Contextual Personalisation of services will rule
    -10% of purchase decisions will be influenced by intelligent machines
  3. AI-Led FinTech is here to stay!
    -30% of large Financial Institutions are investing in Artificial Intelligence
    -25% of AI projects will overwhelm as they will succeed in syncing with operational model
  4. Open Banking to Lay Siege on Data
    -Amazon, Google, Facebook and other FinTech providers will create innovative financial ecosystems
    -Banking business models will be redefined- 50% of banks will fail to exploit open banking
  5. Security Investments will translate to profit
    -10% of firms will translate security investments to profit
    -Identity management will become central to security for profit measures
    -Security data will be used for personalisation and CX enhancement
  6. Custom Tech Solutions
    -New FinTech and other tech delivery across banking ecosystem with open API’s
    -Cloud for improved agility, flexibility, and eliminating on-premise dependency
  7. Contextual Offerings will be key
    -Segment specific offerings for millenials, small businesses and underbanked
    -Mastery of digital media for better customer lifecycle management for mind share / wallet share
  8. Blockchain to continue to make inroads
    -30% of PoCs will continue to accelerate blockchain usage
    -77% are expected to adopt blockchain as a strategy especially against cyber security threats
  9. Key Investment by FI’s
    -74% in Data Analytics
    -51% in Mobile
    -34% in AI
    -32% Cyber Security
  10. Security to be foundation for new offerings
    -Security and RegTech to be critical components in new service or product offerings
    -Threat Intelligence services key in mitigation of security risks



The investment Banking Industry is in the state flux. Digital revolution, increased regulation, and seismic shifts, the industry is now aware of the threat that they have been trying to stay ahead. Everyone knows the era of transformation has been underway for over a decade now. Technology now serves as Value proposition in Capital Markets Industry.

What is the digital disruption that is affecting banking and other financial services? It is the growth of Fintech companies around the world. However, what does Fintech mean? An organization that uses technology to make financial systems more efficient.

Fintech entrants are raising more money from the investors than ever before. Year 2016 saw a record of 216 deals worth $1.89 Billion. With private funding in hand, companies are using automation, digitization and simplification to reduce costs, increase efficiencies, build client relationships and facilitate regulatory compliance. The solutions are helping all – Front, Middle and Back Office Operations. They use technologies like AI, Robotics Process Automation, Cloud, Blockchain, amongst others to bring Innovation.

Artificial Intelligence: AI seems to be one of the catchy technology Fintech companies are focusing on. With the help of AI, they can scan & analyze the data from multiple sources, make the trading strategies & sell it to the banks & other financial institutions. Apart from this, AI can be used in fraud analytics, check on the regulatory compliance and to cross-sell & up-sell clients based on the transaction history.

Process Automation:  Process automation can help the capital market firms to replace manual legacy systems, maintain the audit trail, make the system compliant with AML, KYC & other regulations, reconciliation of the various reports & also integrate middle & back office processes. Robotic process automation will bring efficiency in terms of time & money, simplify the processes & can redefine the business models.

Blockchain: Blockchain (distributed ledgers) offers wide range of benefits to the inefficiencies afflicting capital markets industry. Blockchain can create the smart contracts enabled with the encryption for transactions, create distributed records. This will help in using real-time transparent data & create efficient settlement & transaction processing.
Though the applications of this technology are on large scale, the implementation & regulatory compliance will be a tough task.  Many Fintech companies are focusing on the research & developing blockchain modules for Capital Markets processes.

Opportunities for Fintech: Capital Markets have not been able to overcome these challenges, which may prove to be advantageous to the newbies. 

Reducing structural Costs: Investments Banks IT estates is known to be the most difficult cost to address. Improved cost performance will deliver growth.

Redistribution of Resources: Thousands of jobs will be created for financial industry’s new requirements and demands. On the other hand, AI will reduce employees in Capital Markets.

Regulatory changes to be delivered at acceptable costs.

Identifying sources of future growth in terms of changes in client needs.

Downside of Fintech:

Security Risks: As the technologies advance, so do cybercrimes. Fintech an open virtual door to criminal activities which may hamper the growth  

Regulatory Attention: Regulatory agencies are keeping a close watch in terms of legal jurisdiction, customer data and taxation. This affect banks’ agility and ability to compete.

Technical Knowhow: The resources need to be technically educated to match the high-speed chase of Fintech growth market.

While incumbents have survived over the years, the fast changing industry pose greater threat. What could be the possible solution?

Collaboration. Fintech requires established capital market organizations and new ventures to join hands. This would reduce costs for the incumbents and pave way for disruptors into industry. This would revive the old businesses and create new ones in the market.


Startups are springing up across the nation, transforming industries, grabbing market share and challenging the status quo. It’s no wonder, then, that talent is flocking toward these innovative new companies. But who are the 25 most in-demand startups operating in the UK today?

The all-new LinkedIn Top Companies | Startups list has the answer. To surface the companies, we looked at the billions of actions of LinkedIn’s more than 500 million members to determine employee growth, job seeker interest via views and applications, member engagement with the company and its employees — and how well these startups pulled talent from our flagship LinkedIn Top Companies list.

To be eligible for Top Companies | Startups, companies must be at most 10 years old, have at least 100 employees, remain independent and privately held and have at least one round of venture-backed funding. LinkedIn worked with CB Insights to pull a global list of nearly 25,000 eligible venture-backed companies, and we whittled it down to the top 25 that are making waves in the UK.


Deal sizes are increasing in the UK’s disruptive finance space. 

The first three quarters of 2017 saw £2.1bn of investment in UK fintech companies, almost double the total invested in the whole of 2016, according to consultancy Fintech Global.

This makes 2017 already a record year for the sector in terms of funding with more than £2bn invested across 182 deals. The average deal size into UK fintechs is increasing rapidly.

The third quarter of 2017 saw nearly £1.2bn invested in the sector, the largest total investment in a single quarter to date. The quarter also received record investment in large deals with £532m invested across five deals. The largest of these went to P2P lender Prodigy Finance, which raised £155m of debt financing in August.

The size of investments to fintech companies based in the UK has increased rapidly since 2014

Fintech investments valued below £75m had a CAGR of 10.7 per cent between 2014 and 2016, according to Fintech Global. The total amount invested in deals valued above £75m has also increased this year, with £877.1m capital committed so far across eight deals.

Despite the large increase in investment only 80.2 per cent of the number of deals closed in 2016 were completed in the first three quarters of this year.