fintech and the consequences for the consumer

FinTech and the Future of Finance---

Consequences for the consumer

Professor Robin Teigland Stockholm School of Economics

www.slideshare.net/eteiglandwww.funnovation.se

Robin.teigland@hhs.se @RobinTeiglandMay 2016

What is FinTech?Technologies for banking and corporate finance, capital markets, financial data

analytics, payments, and personal financial management

- Accenture/CB Insights Finance Technology

FinTech

Stockholm’s path to Fintech success

Commoditization of banking

Greatly increased ease of transactions

I just bought 1000 SEK of

bitcoins

Mycelium wallet on my phone

Banking is essential,

but banks are not.

Bill Gates

Second wave of digitalization

Recent surveys of millennials

100 FinTech companies in Stockholm

20152014201320122011201020090

10

20

30

40

50

60

70

80

90

100

PaymentsLendingTrading and Banking TechOther FinTechWealth ManagementCrypto CurrencyCrowdfundingTransfers

# of

Com

pani

es

Moving in on traditional bank territory

Inspiration from CB Insights, SEB base webpage slightly modified to make more room

Alternative investments through crowdfunding

Automated investing based on algorithms

Cheaper and easier international payments

Changing behaviors?

Benefits vs challenges- “Condemned to the freedom

of choice” - “Freedom with

responsibility”- Increased spending,

overextending private economy

- Loss of privacy and integrity of data

- Risk of fraud- Cybersecurity- Difficulty in being a good

citizen? - E.g., Income tax filing

+ Increased choice+ Improved ease of

transactions + 24/7/365 access+ Reduced financial fees+ Alternative investment

possibilities+ Lowered switching costs

But will it truly be cashless?

Increased use of EUR and

USD?

How do I declare my

sale of bitcoins?

Future consequences ofEU Payment Services Directive (PSD)?

Payment Services Directive 2 (PSD2) passed on January 12, 2016

Must be included in domestic legislation by January 13, 2018

Among other things, requires that banks open up, through APIs

Intention is to improve consumer experience Some precedent (e.g., Tink), but no longer discretionary What does this mean for FinTech and banks?

Robin Teiglandrobin.teigland@hhs.se

www.slideshare.net/eteiglandwww.funnovation.se

@robin.teigland

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