Challenges and opportunities in a post pandemic world for fin-tech

by Alicia Buckley, Consultant MadlinHanna Consulting

Financial technology is a sector that barely existed a generation ago and yet these businesses now have an impact on our everyday life. They are often newer, fast-growing and dynamic so, as a result, much of what they do is opportunistic. The pandemic and the way the world works as a result of it, has created an environment where these businesses will continue to do what they do best. So what are the challenges and opportunities?

An Easy Life

There is a significant push towards simplifying consumer lives whether that’s banking apps becoming totally user-friendly or trading platforms moving from being nerdy and niche to making investing accessible to all. Those that will perform well are going to be easy to use, consumer-friendly and simplified. Curve, for example, has a facility to have all of your wallets with them on a single card. Businesses like Coinbase mean that everyone can get involved in cryptocurrency investments regardless of if they have a financial background.

A Cashless Society

Over the course of the pandemic, the use of cash has plummeted. We have been doing more of our shopping online, a lot of the retail outlets we go into no longer want to handle cash and ATMs are disappearing from our local areas. The digital process needs to be efficient and consumers need to trust in it. The way we teach younger people about money will change, they won’t have cash and coins to count and need new mechanisms to learn about money. Starling Bank has created a debit card for 6-16-year-olds so they can start to learn about budgeting.

Wealth-Divide

There is no denying that the wealth gap will have widened. Whilst some parts of the population will have managed to save over the course of the lockdown, there will be others who have struggled after losing their income in part or entirely. Klarna and ClearPay as payment providers offer a lifeline for those who want to make purchases but have reputational challenges to overcome to be viewed as a solution and not just another problem.

There is no denying that these financial technology businesses offer a way for people to use systems to better their financial situation. There are risks involved and reputational challenges as a result. The fact that established banking giants are investing in developing more tech-focused solutions means there can be no doubt that the sector will continue to develop and play a central role in our lives.

MadlinHanna Consulting is a recruitment consultancy specialising in corporate affairs, covering public affairs, corporate communications and financial PR. Contact us on 020 8088 4102 for more information or a confidential conversation about these services and more.