In this day and age, there is a lot of talk about how banks need to digitize their business model.Consumers are relying on Internet-connected devices to access financial services, and institutions ened to accommodate those demands. But as it turns out, the digital transformation isn’t happening, which leaves the door wide open for cryptocurrency.
The Time For Digital Transformation is Now
Banks are in the habit of saying one thing while doing the complete opposite. The sector has seen little to no innovation over the past fifty years, and this lackluster approach to technology will not change anytime soon. Although most institutions claim they want to prepare for the Digital Age, very few efforts are being actively undertaken right now.
It all starts with the products and services being offered by the average bank. While they may have a different outlook, the core principles haven’t changed all that much over the past few decades. One thing that has seen an interesting change is how they are being promoted and delivered to potential customers. But that does not make the old hat a new one all of a sudden.
Unfortunately, the same can be said about challenger banks. In the Fintech sector, challenger banks are allegedly leading the charge of the digital revolution. That is not always the case, as most initiatives do nothing more than compete with existing services for a better price or delivery. But the products and services being offered in general are identical to what has existed for many years now.
In fact, one could argue there are four different types of financial service providers right now. The existing institutions, the ones who clone them in a different format, the new traditionals – with a bigger focus on accessibility – and the mobile banks. Four different ways of delivering exactly the same products but in a different format. Some even offer more convenience to obtain these services, but that is not exactly innovation either.
Technically speaking, there is a fifth contender, even though it is often overlooked. Cryptocurrency, in the form of Bitcoin, Dash, or otherwise, is more than a competitor for banks. It is the only form of financial inclusion that has no ties to the existing legacy system or governments. This appeals to a lot of people, despite some entry barriers that remain. Slowly but surely, consumers and retailers will turn to cryptocurrency, unless the banks take digital transformation seriously.