Financial services and TMT must collaborate to reach FinTech potential

While the financial services sector is undergoing comprehensive disruption from financial technology (FinTech), new PwC analysis has revealed that FinTech has a considerable contribution to make in the technology, media and telecommunications (TMT) sector as well. South Africa is among the leading regional markets for FInTech growth.

Analysis from Big Four accounting and advisory firm EY in 2017 revealed that South Africa is among the fastest growing FinTech markets in the world, behind only China and India. The country’s consumer base is increasingly tech savvy, and the major banking institutions have wasted little time in developing FInTech capabilities.

PwC has now conducted its Global FinTech Survey for this year, gauging responses from more than 500 executives working in the financial services and TMT domains to help determine the status of FinTech in the global market. For South Africa, the findings were consistent with apparent market trends.

The South African financial services sector has been quick to adopt FInTech capabilities, which has created a degree of uniformity in the sector. In such an environment, the consumer is increasingly demanding a personalised customer service experience that is suited to individual needs and convenience. 

According to PwC, FinTech has led to similar expectations within the TMT sector, as customers, and collaboration between the two market segments is crucial in the near future. The firm recommends that the duo collaboratively work towards realising FinTech potential, while also addressing another major issue– the skills gap.

The TMT and financial services sectors have both been among the hardest hit by the growing skill gap in South Africa. Experts have suggested that the dissemination of digital skills across the country could help tackle unemployment while also boosting the economy. Collaborative efforts between the two sectors might help realise this scenario.

Commenting on the analysis, PwC Africa Financial Services Lead Costa Natsas said, “SA’s financial services sector is undergoing a process of unprecedented change brought about by the disruptive impact of fintech challengers and the emerging technologies powering their business models. Fintechs are redrawing the competitive landscape and blurring the lines that define players in the FS landscape.”

“Customers' behaviour, and their expectations around how companies interact with them, is changing quickly. The FinTech industry is driving these changes in financial services, and the established businesses in the industry who recognise this are having to learn fast. This is leading to a reassessment of many elements of the customer experience and engagement process that will play out over the next few years,” he added.