The Future of Fintech

“The future of money is digital currency.” — Bill Gates

Henry Blodget, Business Insider Global Editor-in-Chief, sat down recently in Davos with PayPal CEO Daniel Schulman to discuss future trends in Fintech.

Daniel says first off, currencies of all kinds are digitizing. Checks are disappearing. Although 85 percent of the world’s transaction are still in cash, they’re increasingly digitizing, whether in the form of cards, or the actual currency itself starts to digitize. He says all of this is enabled by the explosion of ‘mobile’ into the marketplace and points to two trends happening in mobile right now. One, you have all the power of a bank branch in the palm of your hand, so basic consumer financial transactions can be done quickly. You don’t need to stand in line to make a transaction. You can do it immediately. And it’s more secure than money.

Two, according to Daniel, it’s much less expensive in the digital world, to the tune of 80 to 90 percent less expensive to serve a customer over traditional bank branches. He says we’re going to have an explosion of the kinds of platforms that manage and move money for consumers. The retail side is going through a fundamental transformation due to mobile as well. There used to be distinct worlds of online and offline. Mobile is blurring that distinction. He asks, if you make a purchase using your mobile phone and pick it up in store, is it online or is it offline? It’s actually a combination.

Daniel says more and more retailers are taking a look at what Amazon and others are doing and asking, how do I compete? How do I use mobile to get closer and more intimate with my customer? He says digital payments is a key driver of these trends and they will only continue to accelerate. You can see his full comments here.