Don’t dismiss fintech revolution, but don’t romanticise it

Added 13th September 2016

A random walk through the world of wealth management.

Don’t dismiss fintech revolution, but don’t romanticise it

The coming of a fintech revolution has been heralded for some time. 

From robo-advice to blockchain the phrase has been associated with all manner of developments that are on hailed as being on the verge of tearing up the current financial services playbook and forcing the sector to adapt or die.

This is understandable given the sort of disruption technology has brought to other industries already; there is a strong desire to ensure one doesn’t become the next Kodak or Thomas Cook.

Which is why I was eager to attend the Wealth Management Association’s first ever fintech conference on Wednesday to see how what the reality actually looks like.

But, the more I listened to the speakers the more I realised that not only is fintech an exceptionally broad term, but also too often the words and concepts it encloses take on a life of their own, becoming simulacra for the actual technologies involved and imbued with a great deal more power and functionality than is actually the case.


Of these, the worst culprit, is arguably ‘robo-advice’. Depending on your perspective it conjures an image of either a Jetsons-like future of robots willing and able to do the mundane tasks we no longer want to, freeing up our time to fly cars and the like, or of a bleak, jobless future spent cowering in the wake of our new robotic overlords.

The reality is likely going to be a much more moderate middle ground and it is likely to take some time to get there. Especially, as James Alexander, associate director in KPMG’s global strategy group pointed during the conference here are neither many actual robots, nor much advice on offer from current robo-advice offerings.

Likewise, a term like blockchain gets bandied about as either a silver bullet for all manner of evils or the technology that facilitates cryptocurrencies and which is likely to only add to the opacity of the global financial system.

But, as Michael Mainelli, Z/Yen executive chairman and another speaker at the WMA conference pointed out, not only is it not a new technology, when boiled down, it can be defined as a ledger of transactions that cannot be changed, that can be shared and which is stored in multiple locations.

While undoubtedly powerful, it is, he believes destined to become like database technology, a very useful tool that sits in the background and facilitates, but perhaps is not quite the magical solution to everything that some would have you believe.

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