COMPARATIVE ANALYSIS OF BANKING AND NON- BANKING DIGITAL FINANCIAL SERVICES

In general, the term “financial technology” applies to any innovation in financial or business operations and to the establishment of digital currencies in double- digit bookkeeping. Since the evolution of the Internet and smartphone, however, the financial technology sector has seen tremendous growth, and fintech, which used to refer to computer technology used in the back office of banks or trading firms, now represents a wide range of technological interventions for personal and commercial finance. Over the years, various financial service providers such as commercial banks, insurance companies, investment banks and other financial institutions have taken advantage of technology but to increase their reach, customer satisfaction and efficiency as well as emerging market efficiency and technological development. However, the level of technology adoption is not equal to actual ability and thus there have been gaps in the financial services industry. According to ASSOCHAM (2019), from January 2013 to October 2018, the FinTech companies established in 1994, became a hotbed of business activity. In addition, KPMG claims global investment in FinTech companies reached US$ 111.8 billion in all 2196 contracts in 2018, while a PwC survey found that 47%  of TMT organizations (technology, media and communications) and 48% of FS organizations (finance category) have moved extensively into fintech into a model of their strategic operations. Also, 44% of TMT and 37% of FS organizations incorporate emerging technologies into the products and services they sell.

Traditional Banks and Financial Institutions have always focused on technology as a basis for business proposals, rather than for new business proposals themselves. On the other hand, non-Banking financial institutions, commonly known as fintech firms (due to their recognition of financial technology) such as Paytm, Ling Cart, Amazon Pay etc. They also play that role by introducing digital technologies to create new business proposals and attack new market segments that were previously impossible.