The money revolution: why you should consider a career in FinTech
The internet has already caused a lot of disruption in its relatively short existence, and now it’s well on its way to disrupting traditional assumptions about the banking system and the way money circulates. From Paypal to Robinhood, the fintech revolution is starting to look like a genuine existential threat to once venerable financial institutions. While bitcoin lacks the credentials of actual currency, it showed that banks were not necessary intermediaries. Now tech companies are proving that they can – with existing currencies – provide the same services as banks, only with lower costs and greater convenience for the customer.
And it’s not just financial technology startups who are leading the charge. Heavy-hitters like Google, Facebook, and Amazon have already launched their own assaults on the banking industry – and consumers are taking notice.
What’s at stake
So that’s it, right? It’s all over for the banks. They’re lumbering dinosaurs and their days are numbered.
Not quite. Nobody with that kind of power and influence is going down without a fight. No matter how frustrated people get with user fees and credit card rates, the big banks still have greater brand recognition and consumer trust than even the most ubiquitous tech companies. They also have a lot more money. In the battle to maintain loyalty at home, and to encourage market expansion in the developing world, banks everywhere are taking the challenge of tech disruptors seriously.
Embracing the fintech movement
Back in early March, PricewaterhouseCoopers issued a report concerning the growth of fintech ventures that compete with banks. Noting that “81% of global banking CEO’s see the pace of tech change as a threat to growth,” the report urged Canada’s Big Five banks to continue overhauling outdated infrastructure and follow three main points: (1) fund fintech projects, (2) destroy competition whenever possible, and (3) form alliances if necessary – all while maintaining the long view, since the problem isn’t going away any time soon. And that’s exactly what’s been happening: each of Canada’s major banks have begun offering Apple Pay; in-house R&D investment has been increasing; and partnerships have been and are being formed with influential tech hubs.
The only other important recommendation of the report was to continue lobbying government for increased funding for technology.
Not surprisingly, the glittering centrepiece of Canada’s latest federal budget is an $800 million infusion that is betting on tech to rejuvenate the economy. Though it won’t be known exactly where the majority of the money will be going until the fall, the purpose is clear: to create technology “ecosystems” – like those already existing in several other countries – that bring together startups, venture capitalists, universities, and, of course, BANKS, to drag Canada into the 21st Century. This, in many ways, is a reaction to global trends. As an Accenture study reports, 2015 investment in global fintech startups (i.e. ones competing with banks) increased by 23 per cent, while investments in “collaborative” fintechs (i.e. ones that work with banks) increased by 138 per cent over the same period.
Attention all job seekers: FOLLOW THE MONEY
What does this all mean? If you’re looking for long-term employment in a sector of the economy that’s increasingly being flooded with cash (global fintech investment exceeded $22 billion in 2015), you should probably consider enrolling yourself in a coding course ASAP. And it doesn’t matter whose side you’re on – upstarts or incumbents. If you’re a bold, creative individual with the tech know-how to propel financial services into the future, your talents will be highly valued and rewarded. And if they’re not, you can always go fight for the enemy – whoever you think that is.
Want to see what’s out there? Check out this list of tech jobs.