The 2008 economic crisis opened the door for fintech in the financial services world, as the industry was under severe pressure to cut costs and create greater transparency and accountability in its processes, while also taking greater ownership of its customer experience. Fintech – financial start-ups using revolutionary new technologies that addressed just about every segment of the financial services value chain – seemingly had the answers that banks, investment houses, and asset managers did not. As things like e-wallets and payment apps like Square or Venmo sprang up, however, a shudder came over banks in particular. Would they be disintermediated? That meant, would they be demoted to the background like plumbing, unseen by the client who instead used a third-party app on their phone only remotely linked to the client’s bank? In that scenario, the third-party app would own the client relationship, and by default – the client.
To the rescue came a stuffy, calcified old service line usually reserved for older wealthy clients. Financial advisory suddenly took off after 2008, now geared towards average middle-class retail clients juggling mortgages, loans, taxes, and an investment environment that was becoming increasingly accessible and friendly to their needs. But once again technology struck, this time with bot-based robo-advisory services.
