The biggest threat to banks worldwide may be platform companies like Amazon.com and Alibaba rather than small tech startups that banks have spent the past few years preparing to compete with, warns a report by McKinsey, which adds that financial institutions need to continue to digitalise so as to protect up to 40% of revenues at risk by 2025. McKinsey estimates that digital platforms will account for more than half of all new bank assets in 2025, with traditional banking services such as credit cards accounting for just over 30%.
The biggest threat to banks worldwide may be platform companies like Amazon.com and Alibaba rather than small tech startups that banks have spent the past few years preparing to compete with, warns a report by McKinsey, which adds that financial institutions need to continue to digitalise so as to protect up to 40% of revenues at risk by 2025. “We thought that fintechs would provide the chief digital threat,” say the authors of the report, however, it is becoming increasingly clear these e-commerce giants “are reshaping one industry after another, blurring sector boundaries as they seek to be all things to all people.”