Digital Disruption: Where are we heading?
The COVID-19 outbreak has taken over everything we thought we knew up until now. It has massively disrupted political, economic and social landscapes, and the financial sector has been no exception. Start-ups and forward thinking organizations are preparing for a post-COVID-19 world. However, foreseeing what this world will look like is not as straightforward as one might think. We can be realistically certain that the world will not just return back to the way it was before the pandemic, but how different will it be? The issue with answering this question is that recent history does not give us enough perspective; we have never confronted a crisis like this before. If the financial industry is already struggling, with the unexpected closing of banks and other services that we have always relied on, then digital disruption will accentuate this even further. Although it is not possible to predict what a post- COVID society will look like, it is possible to plan for it.
Digital disruption is shifting in a relatively profitable manner from one established business model to another, with technology in the driver’s seat. Today with the COVID-19 pandemic, fintechs have efficiently planned to be the engine that reactivates the economy in the face of an accelerated digital transformation. With technology aiming to offer customers a simple, personalized and convenient-based interface, Fintech companies have limitless disruptive potential to establish a new transactional paradigm. The following are some of the most promising verticals:
- Mobile Growth in Payments Apps
In an era where e-schooling, e-meetings and e-parties have transformed into the “new normality”, it comes as no surprise that e-commerce has gained massive momentum too. Digital-only banks have a lot going for them, offering borderless payments, P2P transfers, contactless payments with no transaction fees and a chance to purchase and exchange Bitcoin and other cryptocurrencies.
- Blockchain technology
With the expected Facebook-led digital currency Libra on the verge of launching, blockchain technology came here to stay. In a simplified manner, the concept of blockchain can be paralleled with that of a data-base, where vast amounts of data are collected and analyzed. However, this new modus operando changes the way you interact with this same data, bringing decentralized consensus, trusted computing, smart contracts, and proof of work/stake to govern your operations.
Overall, the uncertainty of the time we are living has enhanced consumer ́s expectations to place communal welfare at the core of businesses’ decision-making processes. While only in its infancy, fintechs developing these disruptive technologies can pioneer a time where transparency, equality and autonomy evolve to an unprecedented level.
By Maria Carminho Tomé