The fintech sector is one of the areas reaping from the COVID-19 pandemic. The use of fintech applications, according to news monitored in other countries has increased by 72% in just one week. Accordingly, neo-banks have registered a sharp increase in their subscriptions. Now, digital financial services are moving against the downward trend in the economy. According to an industry report, Glint Pay’s gold buying programme has seen a colossal 718% increase in traffic.
Recently, the fintech landscape got its first assessment. Now that all continents are affected by the COVID-19 epidemic, the first measures of the increase in digital financial services are undeniable. A study by deVere Group, fintech applications have increased by 72% in one week in April. More than ever, the startups behind this small revolution are on the rise. Online banks and neo-banks, in particular, are seeing their subscriptions rise sharply.
“The world has changed”, James Green, deVere’s European Group Director declared. He explained that the measures the company took to help fight the coronavirus “are affecting the way we interact, live, work and take care of our finances.” Two factors do indeed seem to explain the massive rebound in the popularity of these new services in the financial technology industry.
On the one hand, confined people want to keep up with digital services that no longer require travel. On the other hand, fun features, such as those advocated by neo-banks like Revolut or N26, are a good way to review the way people manage their money.
Despite low morale among individuals, and the possibility of a severe recession in the economy, digital financial services continue to see increases in usage.
Media reports have also indicated that traditional banks are in sights as well as online banks are taking advantage of the assets and products of their parent company. In Europe, Revolut can take advantage of its young and native image in the rise of fintech. Proof of this is that even Société Générale admitted that “in terms of the number of clients, they are really starting to weigh in.” As with N26, Revolut has deployed its offer in three different bank card formulas.
Recently, Revolut officially entered the market in the United States, in the midst of a crisis for traditional banks that have seen their stock market listings plummet. Its new start could be helped by the health measures gradually being taken by metropolises such as New York, where more and more people are in a situation of confinement.
Despite low morale among individuals, and the possibility of a severe recession in the economy, digital financial services continue to see increases in usage. Some applications are reaching new heights: Glint Pay’s gold-buying program, for example, has seen a colossal 718% increase in traffic. For the bank, a new era has already begun with digitization and new technologies driving change.
Now, the fintech landscape is one of those few areas to reap from the current situation. The sector shares this increase in traffic and popularity with video conferencing platforms such as Zoom, Google Hangouts, Skype and FaceTime for teleworking and streaming platforms such as Netflix, YouTube, Amazon Prime Video and Disney Plus for home entertainment.
In Nigeria, in order to reduce the number of customers trooping in to their banking halls, prevent large gathering and encourage social distancing as the coronavirus fear spreads, some Nigerian banks have encouraged the use of self-service through digital platforms and internet banking.
For instance, Fidelity Bank and Ecobank did send messages recently to their customers to take advantage of their digital innovation instead of visiting their banking halls. Although the banks said their branches would still be opened to customers who would prefer physical service at the bank branch.
Now, the fintech landscape is one of those few areas to reap from the current situation.
Earlier, the customers of Fidelity Bank had gone on a rampage on the bank’s Twitter account to demand better banking service. Some of the tweets, according to media reports, include Write –back supports earnings growth, Fidelity Bank earnings beats estimates; pre-tax profit soars 29%, coronavirus: Nigerian banks start advising customers against visiting banking halls for transactions.
The above came after the federal government had placed a ban on the large gathering in cinemas, restaurant, hotels, night clubs and event centres. The banks were excluded from the list, but some banks as a precaution are already offering alternative banking to reduce the number of customers inside their halls.
In a mail sent to its customers, Fidelity Bank had advised the customers to take advantage of its robust online banking solutions available for their ease, convenience and as a further precautionary measure. Ecobank and other banks like GTB, UBA and others made efforts to sway their customers to utilize the outdoor platforms as part of efforts to ensure social distancing, which will help to curtail the spread of COVID-19.
The moves by the banks have actually encouraged more Nigerians to further embrace and use digital platforms such as ATMs, PoS, internet banking transactions for cash transaction. This would also boost the cashless policy of the Central Bank of Nigeria [CBN] and increase the number beyond the imaginations.
*Olaegbe ([email protected])
