European banks have lost between three percent to four percent, or €22 billion of market share to challenger mobile-only banks such as N26 and Revolut because they did not develop new, customer-centric, and data-driven approaches to personalized banking.
22 big bs is a substantial amount of money lost because of retail banking’s failure to innovate quickly and to meet the evolving demands of the modern-day customer.
I see a similar trend quickly approaching commercial banking as IoT’s involvement in the financial sector reaches a whopping $2.1 billion by 2023, at a compound annual growth rate of 52.1% YOY.
Yet while the financial sector screams for aggressive IoT adoption, they fall short of one critical aspect that stifles their successful transition.
Banks do not possess the deep IoT and data-standardization know-how required to efficiently and securely process equipment usage data.
These institutions have tried to develop a data-driven financing solution, but the majority struggle because they just can’t seem to get all the moving parts properly aligned.
They face scalability issues of retrieving, understanding, and applying data to create actionable outcomes.
It makes sense that Microsoft’s 2019 IoT signal’s report discovered that 38% of their respondents stated that the top challenge for IoT adoption is complexity or technical challenges since there’s a lack of industry expertise.
So, what does this mean for your financial organization?
Banks who struggle to adopt the latest technology, like IoT and data, will end up failing in bringing more flexible and customer-focused financing products in the market and will again lose further market share.
We see a bold and bright opportunity for linx4 to help such institutions navigate the trenches of data management.
We want to help banks, insurance companies, and other financial groups protect their corporate financing market share with tailor-made equipment financing solutions that combat traditional financing’s pitfalls.
Why does traditional financing suck?
Because it posses glaring weaknesses in terms of payment flexibility, cash flow optimization, and risk-sharing opportunities, to name a few.
Conventional methods prevent equipment seeker’s from buying machinery because it requires hefty upfront investments.
On top of that, buyers can’t distribute the cash damage incurred from direct purchases to coincide with money coming into the business.
Not to mention that the shift in buyer-seller risk is entirely unfair for those manufacturers who purchase new machinery out-right.
Traditional financing is out-dated and is not designed to meet the expectations of buyers today.