The fintech momentThis may now be changing.
Our research into financial-technology (fintech) companies has found the number
of start-ups is today greater than 2,000, compared with 800 in April 2015.1Fintech companies are undoubtedly having a moment (Exhibit 1).Globally, nearly $23
billion of venture capital and growth equity has been deployed to fintechs over
the past five years, and this numb
...[Show More]
The fintech moment
This may now be changing.
Our research into financial-technology (fintech) companies has found the number
of start-ups is today greater than 2,000, compared with 800 in April 2015.1Fintech companies are undoubtedly having a moment (Exhibit 1).
Globally, nearly $23
billion of venture capital and growth equity has been deployed to fintechs over
the past five years, and this number is growing quickly: $12.2 billion was
deployed in 2014 alone (Exhibit 2).
http://www.mckinsey.com/industries/financial-services/our-insights/cutting-through-the-noise-around-financial-technology
There is also the possibility
that Millennials use of checks is impacted by banks that have linked old and
new payment channels. According to the research, a total of 44% of Millennials
used a PC/Mac, smartphone or tablet to deposit a check in the last three
months.
Except for P2P transactions,
cards have become the dominant payment option of choice for Millennials. Even
with P2P. cards are a close second choice, with cash being used by 48% of
millennials and cards by 44%. Mobile payments (both contactless and in-app) are
the next most used method, being used by 22% of Millennials.
Millennials, Alternative Providers and the Future
While Millennials are the first
segment to try new technologies, the research found that Millennials still
prefer to do mobile payments offered by their bank (70%), by PayPal (64%), by a
card provider (62%) or by a service provider endorsed by their bank (49%). They
do not prefer large technology companies, ISPs, telcos or the Government as
mobile payment providers. Finally, only 27% of Millennials would use mobile payments
provided by a new fintech provider.
To increase mobile payment use,
Millennials make it very clear that there will need to be security
guarantees. They also want mobile banking is easy to use, contextual and
integrated with their daily lives. Finally, 73% agree that they would like to
be able to make instant payments – with the emphasis on instant.
http://www.fitech.com/news/why-don-t-millennials-love-digital-payments/
Millennials
don’t just use social media for posting selfies and status updates. They use
social sites to send peer-to-peer payments (P2P) for the kind of casual funds
transfers needed to settle up after splitting a dinner bill or to split the
rent with a roommate. Now social sites are incorporating payment methods that
could let them pay that dinner bill directly from the site. Just as
Millennials’ attachment to their phones has spurred mobile computing and BYOD
for business, their acceptance of these social media payment methods may lead
to using these sites to pay for business expenses, at least for purchases of
the kinds of products that don’t require specially negotiated contracts.
Payments from these apps mean payment
information needs to be stored as part of users’ profiles in the apps. This
means the security of these sites becomes more important. For sites where
privacy previously meant limiting who can read your status updates, protecting
payment information may present new challenges.
http://www.wexinc.com/wex-corporate/will-millennials-drive-your-payments-to-social-media/
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