Capital Markets innovation and the FinTech landscape

Foreword
Until recently, FinTech was mainly focused
in the payments, remittance, peer-to-peer
lending and equity crowdfunding sectors.
But, over the course of the last year, we have
seen an increase in activity in capital markets:
solutions to complex front-, middle- and backoffice
problems are emerging in the form of
FinTech solutions.
These solutions are using technological advances such as
Artificial Intelligence (AI), Robotic Process Automation (RPA),
distributed ledgers and cloud technologies, among others, to
deliver innovation that was previously hard to achieve.
Wholesale digital solutions are coming of age in capital markets
and will help managers focus on delivering superior performance
for their firms, clients and counterparties. Whether FinTech
solutions help the front office make better investment decisions
through Advanced Analytics or reduce costs through improved
post-trade processing platforms, the opportunities appear vast.
No one can argue that making better risk-adjusted returns for
clients and firms through the efficient deployment of digital
technologies deserves serious consideration. Regardless of
macroeconomic trends, the era of digital has arrived in capital
markets, and we must all become better digital data, knowledge
and process managers across the end-to-end business to
maximize our overall performance and contribution.
Investment banks, through their accelerators and labs, have
started to engage with FinTechs to understand how to work
better together. There are hundreds of entrepreneurs, many
with excellent capital market pedigrees, developing innovative
solutions to complex problems and seeking partnerships,
and getting the engagement model right is critical.
There is more innovation going on outside of an institution’s
four walls than inside, and the investment in participating in that
innovation is low relative to the risk of not being abreast of the
FinTech landscape and players.
As an independent members association for FinTech, Innovate
Finance is dedicated to open and inclusive collaboration of all
players in the ecosystem. We were delighted when, during our
first Capital Markets Members’ Working Group in January 2016,
EY committed to deliver the group’s first actionable request for
a “FinTech landscape report in capital markets.”
The report is a guide to the areas in which FinTechs and
institutions can better collaborate to help transform capital
markets; it was compiled following consultations with a number
of Innovate Finance members across the (global) working
group. On behalf of the group’s co-chairs and participants, and
the Innovate Finance team, we would like to thank EY for this
excellent contribution to the community.
Lawrence Wintermeyer
CEO, Innovate Finance
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