Quarter of Banks will use Startups to Replace Legacy IT

According to research a quarter of banks will go to financial technology suppliers for their online and mobile banking requirements by 2020.

The prediction, from Gartner, comes as increasing numbers of financial technology startup firms are developing online and mobile products and services for banks, while traditional suppliers are lagging behind.

According to Gartner consumers need services via apps that are easy to use and accessible online and via mobile devices, however banks do not want to develop these themselves.

Banks are in fact actively encouraging startups to innovate in capital, knowledge and experience through startup programmes.

Gartner believes the gap in the market opened due to legacy IT suppliers being too slow to meet the demands of banks –which are trying to cater for the demands of their existing and potential customers.

A recent EIU study showed that bankers expect the banking environment to be shaped strongly by technology and non-traditional competitors by 2020.Nearly two thirds said retail peer-to-peer lending would be available via banking platforms and 64% said banking would be fully automated. 

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