Ever since the establishment of the first commercial bank in the United States in 1781, banks have been backed up by governments and quickly received the status of organizations specializing in mortgage lending and credit. As the lifeblood of the world’s economy, banks have also faced burdensome regulation.

Given this reality, Bill Gate’s referral to banks as ‘dinosaurs’ is not surprising; but today, with FinTech gaining momentum, we seem to be witnessing a real fight – FinTech versus banking – in which banks’ fortifications and resistance to technology seem to be getting weaker.

What’s the impact of FinTech on banks? What does the future hold for FinTech and banking? What is it that makes FinTech so successful, especially FinTech mobile apps – which saw an uptick in the number of users, according to App Annie’s 2017 report?

As a company that successfully operates top-ranked financial websites and utilizes smart technology and statistical modeling to promote mobile finance apps, it seemed unreasonable for us to stand by quietly, without figuring out the answers to everything related to the FinTech versus banking fight.

FinTech is Changing the Finance Playground

Finance and payment services are no longer banks’ prerogative; companies utilizing technology to provide financial services to consumers – FinTech companies – are on the rise. With the total venture capital invested in FinTech in 2017 amounting to $12.85 billion, FinTech revolution has been called ‘the most profound transformation in history.’ FinTech apps growth rate stands at 30% a year and, as of January 2018, FinTech apps comprise around 10% of all mobile apps in the Apple Store.

FinTech is Conquering the World

FinTech conquering the world


Sweden is said to lead the pack in redefining the finance industry for the rest of us. It’s evident in Sweden’s initiative to become cashless, for starters. Sweden’s government, together with Swedish tech-friendly infrastructure, have played a significant role in FinTech’s rapid spreading causing the emergence of a highly entrepreneurial environment full of resources. The question is: “Will the planned European Commission’s regulations change it, or will they empower it to spread across the EU, as they say?”

Chances are you’ve heard about EU’s new regulations regarding Fintech. In February 2018, the European Commission was to reveal a set of recommendations, focusing on online security, the blockchain, and cloud data services. However, possibly to avoid sector’s over-regulation, the latest news exposes that the European Commission is taking a step back from announcing new regulation laws for the industry.


With people getting full of ideas that needed to be released, FinTech has spread naturally in China. Given Chinese society’s accumulated wealth, investments were necessary to be made and banks – although they tried – couldn’t catch up with such a high-speed economy.

Today, China is considered to be one of the biggest markets for FinTech, with one of the largest Chinese FinTech companies valued at around $60 billion.

FinTech versus Banking Apps

The effect of Fintech on banking is grandiose: banks have started to make banking apps – as evident by banking apps’ sudden take off in 2015 – but FinTech has no intention of holding its horses.

FinTech’s continuous innovation is seen in the frequent emergence of FinTech mobile apps – everything from mobile payments (the most popular sector to date) to managing cryptocurrencies.  So, what is it that makes FinTech mobile apps so successful?

1) Putting Customers First

FinTech apps are customer-centric

FinTech apps focus on the customer. This is not to say that customers aren’t important to banks (most of our financial activity is still associated with banks, and they still have the power to navigate the economy), but FinTech apps know how to put customers in the center. When you look at FinTech mobile apps, the user experience is often at its finest; the apps are simple and convenient.

Unfortunately, banks still have a long way to go in that department: most of us drown in the sea of text, complex transitions and other features of banking apps – something that often pushes us away.

Lots of banking apps are feature-rich, that’s true. However, many of the features never get discovered. FinTech mobile apps are another story: they are fixated on engagement and, unlike banking apps, are made to provide solutions to particular challenges in the most efficient manner.

Many keep on advising banks to talk more to their customers and analyze their behavior, collecting valuable feedback on the way to ensure the improvement of their products and service, especially with the growing number of Millennials who crave digital and are open to options when it comes to new financial service providers.

2) The Secrets of User Acquisition

User acquisition FinTech apps

To be successful, you must develop a product that people want, and, for banking apps, it’s harder than it looks – they are directly associated with banks and not personal finance.

Let’s face it; banks aren’t the kind of establishments you’d be eager to visit. Banks are the kind of establishments people can even get scared of: how do you feel when a bank representative calls you about your mortgage? It’s hard to communicate value when people feel uneasy around you.

When it comes to FinTech and personal finance mobile apps, they are experts in user acquisition. The apps are known for their expertise at communicating their value to users in a clear-cut manner from the very first user experience. FinTech mobile apps customer offerings are often sharp and direct, look at apps like Credit Karma.

Many personal finance apps aim to act as users’ own financial advisor, documenting their every transaction, managing their budget, etc. Who wouldn’t want that, considering the chaotic world we live in?

3) No Legacy

FinTech mobile apps are legacy-free. That is, they don’t have any old infrastructure, decayed processes, heritage or history – all of which make a fruitful ground for the creation of conservative operational models that can cause the apps to move at a glacial pace. Hence, acting in innovative ways is something that comes naturally to FinTech mobile apps in comparison to banking apps.

For user acquisition, history can also be viewed as one’s strength since building trust over time is one of user acquisition’s critical components. However, not when an institution takes a hit which is quite hard to recover from – the financial crisis of 2008.

4) FinTech Mobile Apps Breathe Innovation

The reason? FinTech apps are powered by the latest, cutting-edge technologies like Blockchain which, among all, is said to revolutionize global payments, as well as the way businesses, are being run. Meaning? FinTech mobile apps’ hunger for innovation lies not only in the tech they use but also in the way they approach business.

And while we are on the topic of innovation, as FinTech moves towards API integrations, biometric security, etc., we’ll hear more about how deep-rooted innovation is in FinTech.

5) Mobile-First/-Only

FinTech is mobile-first

Mobile phones are FinTech’s primary medium. Some of FinTech mobile apps are even mobile-only, in contrast to banking apps: you don’t necessarily need a banking app to enjoy banks’ services.

Take Revolut, for example – the so-called ‘money without borders’ app. Even when you visit Revolut’s website, the first thing you’re asked to do is to enter your mobile phone number. Smartphones – which have become omnipresent – enable this new paradigm.

How are Banks Responding to FinTech Apps Success?

Despite the immense impact of FinTech on banks, there’s no doubt that banks need to fight back, and some steps have been taken already.

Banks’ total IT spend has increased: they are investing heavily in digital, hence, the development of banking apps. Moreover, we’re witnessing a rise in accelerators: more and more bank CEO’s see themselves as IT providers, investing in startup programs to incubate FinTech companies.

Some banks, like DBS bank in Singapore, have also decided to ‘innovate’ from within, promoting a “digital mindset” among their employees.

Although this approach is excellent, banks are advised to re-evaluate it to the point of starting from square one, answering fundamental questions like why innovate in the first place and what path to take when innovating. Banks can’t just start shouting: “We’re innovating!” It cannot be stressed enough: banking institutions should analyze data and be more attentive to their audiences.

What’s more, there are fields in which FinTech companies have yet to excel such as regulatory compliance. Banks can utilize their success in the field to their advantage and offer their customers credibility and better protection of personal/financial interests.

Bottom Line

FinTech mobile apps are having a moment, and innovation is flowing through them. Expect to see more FinTech mobile apps emerging in the future.

As for banks, they should start acting faster, developing and growing their apps to get closer to consumers.

Time will pass until FinTech and banks will be regarded as equals power-wise. Although, whether or not the two should be seen as equals is a different story.

Contact us to maximize your app’s performance and boost user acquisition.