Is Banking Too Regulated to Be Disrupted by FinTech Startups?

Will banks suffer the same fate as bookstores suffered to Amazon? With financial tech startups like PayPal and other non-bank providers of financial services threatening to encroach on traditional banking territory, will banks continue to be relevant to the younger generations to come?

According to John Authers, from his recent article in the Financial Times, banks aren’t going to be “toppled” by non-bank startups and tossed into oblivion. But why? Authers says because of the high barrier to entry, “heavy regulation.” He believes the banking industry has staying power because of high regulation and growing concerns about security, as compared to other industries that were so easily disrupted by tech startups.

But what about the recent announcement from Apple about ‘Apple Pay?’ Will Apple find a way to loosen the firm grasp that banks have on payments? What is your opinion on this topic? Will banks maintain their position as the gatekeepers of the financial services industry, or will this position be toppled by a financial technology startup?

(Source: FT.com: http://www.ft.com/intl/cms/s/0/e0b53980-4aa2-11e4-b8bc-00144feab7de.html#axzz3F5nn1v8M)

Posted by Corey Curwick Dutton