A new report by the World Economic Forum into the transformation of financial services (FS) raises some interesting insights about the true impact of FinTech companies on the sector.

For many years the rhetoric has been FinTech’s are changing the face of FS while gaining market share. Unquestionably FinTech’s have driven innovation of technologies such as front-end Artificial Intelligence chatbots and Blockchain smart contracts, as well as modernisation of traditional FS services to meet consumers growing demand for autonomy. However, the flipside is the majority do not possess the size and scale to compete with traditional bricks and mortar institutions.

In a symbiotic relationship, traditional institutions have learned from the FinTech’s and deployed new products and services, yet have themselves become increasingly dependent on large technology companies for infrastructure, platforms, and data. For example, Amazon Web Services (AWS) is forming the backbone for established financial services companies like JP Morgan and start-ups such as Xignite.

Perhaps what is more interesting are the number of new non-FS entrants disrupting traditional FS markets with the likes of Uber, Airbnb and Tesla already creating new engagement models for insurers and necessitating a shift in traditional insurance product design.

For example, Tesla has quietly rolled out lifetime auto insurance for most of its cars sold in Asia where the insurance cost is included in the vehicle’s purchase price. With the continuous investment and innovation around autopilot and safety features, Tesla aims to improve the risk profile of its cars over time and drive down insurance costs.

One thing is for sure, the transformational effect of technology is shifting the FS market place in favour of the consumer.

The World Economic Forum report is free to download here.