Technology-led innovation has the potential to truly disrupt existing business models and distribution channels in the financial services industry.
In Australia and more broadly, we have seen start-ups build innovative payment systems, peer-to-peer lending platforms, crypto-currencies, robo-advice and automated investment management. In the United States, for example, New York State just approved the first virtual currency exchange.
However, the large institutions are well capitalized, have large customer bases and are adapting their innovation strategies to use new technology to strengthen their dominant market positions. In the United States, some of the larger institutions are choosing to invest in new technology companies rather than develop the new products in-house.
The challenge for the regulators is to facilitate such innovation while at the same time protecting consumers from their own poor purchasing decisions and from market misconduct.
These were some of the central themes canvassed at the annual Financial Institutions Symposium hosted by Norton Rose Fulbright in Sydney.
Blog postings from Australia on the above themes can be found in the links set out below.
View Innovation and disruption, 11 May 2015
View Regulatory disruption, 12 May 2015
View Financial Services Tomorrow, 12 May 2015