Most of the Banking disruption is still to come

A new research produced by Citi Bank predict that North American banks could lose more than a third of revenues from traditional savings, lending and investment activities to tech-based rivals — including those backed by the banks themselves.

By 2025, North American banks could lose 34 per cent of revenue from payments, investments, personal lending, SME lending and business lending to “disrupters” including fintechs, technology companies and the banks’ own start-ups.

The only part of the North American market that is expected to escape this dramatic upheaval is credit card lending, with disrupters’ share at 17 per cent by 2025.

The established banks will be disrupted not only by the new fintech players (as Lending Club and Founding Circle) but mainly by the existing Tech Giants.

In Korea, the messaging app Kakao (the “Whatsapp of Korea) launched an online bank in August 2017 and after less than 1 year the online bank has already 5 million customers.

In January 20018 Google launched in India Tez, a mobile app that allows payments through smartphone.

Tez, the Hindi work for “fast”, requires users to possess either an iOS or Android device equipped with a microphone and speakers, download an app and then link their device to their bank accounts and the Unified Payments Interface employed by 55 local banks.

WhatsApp has been beta testing its Indian payments offering with ~1 million clients. Currently, over 200 million Indians use WhatsApp for messaging: by 2019, many (perhaps most) of these social users could also be payments users.

WhatsApp doesn’t currently have an advertising revenue model to support its payments growth, but its parent, Facebook, does....