CONCLUDING REMARKS
This chapter examines why FinTech emerged outside of banks. Part of the problem is that misunderstandings about innovation—such as the technology mudslide hypothesis—stop banks from being innovators themselves.
Unfortunately, competing forces further diminish the ability of banks to invent and deliver products and services their customers want. In the end, they need to develop the core competencies to innovate, or they risk becoming another item in the list of industries that have failed to see the writing on the wall.This chapter concludes the first part of this book in which we have examined the history and status quo of FinTech and its position in the wider financial sector. In Part Three we will offer more insights into the effective strategies for FinTech entrepreneurs and banks to compete in the hybrid financial world. Before we venture into strategy, we first change sides over to established financial institutions in Part Two. There, we examine how banks “do” credit, and how they assess the risk and profitability of loans. Then we will investigate difficulties and strategies on the road to the future of credit in Chapter 14, Digital Dilemmas, and Chapter 15, Digital Strategy.
NOTES
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15. Fleming, Sam (2014) “George Osborne to reveal shake-up of SME loans” (Financial Times, 5 August 2014), http://www.ft.com/intl/cms/s/0/14a1ec8c-1cc4-11e4-88c3-00144feabdc0.html.
16. Funding Circle (2014a) “Funding Circle & Santander announce partnership to support thousands of UK businesses” (18 June 2014), https://www.fundingcircle.com/blog/2014/06/funding-circle- santander-announce-partnership-support-thousands-uk-businesses/.
17. Dunkley, Emma (2014) “Royal Bank of Scotland to enter P2P lending market” (Financial Times, 19 October 2014), http://www.ft.com/intl/cms/s/0/660447b0-5625-11e4-93b3-00144feab7de.html.
18. Prahalad, C K; Hamel, Gary, “The Core Competence of the Corporation” (Harvard Business Review May-June 1990).
19. Ibid.
20. Ibid.
21. Ibid.
22. Ibid.
23. Ibid.
24. Ibid.
25. Sviokla, John and Cohen, Mitch (2014) The Self-Made Billionaire Effect: How Extreme Producers Create Massive Value (New York: Penguin).
26. Ibid.
27. Peter, Laurence; Hull, Raymond (1969) The Peter Principle: Why Things Always Go Wrong (New York: William Morrow and Company).
28. Prahalad, C K; Hamel, Gary; “The Core Competence of the Corporation” (Harvard Business Review May-June 1990).
29. Christensen, Clayton; Allworth, James; Dillon, Karen (2012) How Will You Measure Your Life? (New York: Harper Business).
30. Ibid.
31. King, Brett (2013) Bank 3.0: Why Banking is No Longer Somewhere You Go, But Something You Do (Hoboken: Wiley).
32. Gordon Mills, Karen and McCarthy, Brayden (2014) “The State of Small Business Lending: Credit Access during the Recovery and How Technology May Change the Game” (Harvard Business School Working Paper, 22 July 2014), http://www.hbs.edu/faculty/Publication%20Files/15-004_ 09b1bf8b-eb2a-4e63-9c4e-0374f770856f.pdf.