Bluerating | August 2021

Fintech, or “Financial Technology”, consists in the innovation of the banking and financial system through the integration of technology.

Fintech includes a wide range of technological solutions applied to finance: banking and insurance services, peer-to-peer lending, robo-advisors.

The word Fintech evokes the future, but it is already applicable to several companies, especially some networks of financial advisors.

FINECO, for example, is considered as a veritable Fintech by the market. Its success depends on the integration of the human factor, in the person of the financial advisor, and the digital innovation of the services dedicated to clients and financial professionals.

The joint ventures of financial networks are also inspired by Fintech. One above all: the partnership between Banca Generali and Gruppo Saxo, a Danish Fintech company based in Copenhagen and active worldwide.

Or Flowe, launched by Banca Mediolanum in 2020. Flowe is a Fintech company which offers a free App dedicated to young clients and available abroad, starting with Spain and Germany.

The stage was set by European Fintech companies, such as the German N26 or the British Revolut: it all starts with a payment account and wallet services to which are gradually added further financial services.

Thanks to the gradual paradigm shift in the fruition of financial services – from face-to-face interaction at bank branches to virtual interaction through Apps, mobile phone or interactive digital platforms – Fintech represents also the most promising field to invest in.

The innovation of the financial sector seems to be winning the trust of the Italians: while 57% of them turns to traditional banks and insurance companies, the percentage of people who adopt Fintech solutions has grown by 69% in 2020, partly because of the pandemic.

In Italy, the number of Fintech companies is increasing rapidly: 10 companies in 2011, 200 in 2015 and 345 in 2020.

However, Italy does not stand out for its ability to attract investments, with its meager 4% of assets invested in Fintech companies in Europe, as compared to 55% in the UK and 23% in Germany. In fact, in the field of the so-called illiquid investments in private equity there is a lot of room for growth.

Active financial networks and banks have not missed the opportunity to make deals with the best Italian Fintech companies; for example, Credimi, created by Ignazio Rocco di Torrepadula, Banca Generali and Banca Sella, at the forefront with its Milan Fintech District.

A few Fintech companies challenged, more or less consciously, the figure of the financial advisor. A striking example is a Moneyfarm advertisement which mocks financial advisors and invites clients to act autonomously.

However, figures suggest that maybe it is better to join forces with financial networks and banks rather than trying to confront them in such a clumsy way.

Nicola Ronchetti