Fintech In Germany

This book focuses on market developments of crowdfunding, crowdinvesting, crowdlending, social trading, robo-advice, personal financial management, online payment and mobile payment in Germany. FinTech companies are an important driver of innovation in the financial industry. By making financial transactions more user-friendly and transparent, these firms potentially contribute to financial stability and economic growth. The authors define and categorize the different market segments that have emerged. They further provide an assessment of current market volumes and make forecasts for the next 5, 10 and 20 years. Particular attention is given to the empirical findings resulting from scholarly research. Furthermore, the authors evaluate how the German FinTech market ranks relative to international standards. This book will appeal to finance and entrepreneurship researchers as well as practitioners from banking and tech industries. “This book offers a fresh and fascinating look at the FinTech market. The authors provide a rigorous economic analysis of the FinTech market in Germany and offer many insights that are of interest to practitioners, academics, and policymakers alike.” –Professor Douglas Cumming, Schulich School of Business “Germany is one of the fastest growing FinTech markets in Europe. This book not only provides a comprehensive and systematic overview on the developments and actors, but undertakes a visionary outlook on the forthcoming decades based on scientific methods.” –Dr. Thomas Puschmann, Head of Swiss FinTech Innovation Lab

This book examines the FinTech revolution from a data privacy perspective. It analyzes key players on the FinTech market and the developments in various market segments. Particular attention is paid to an empirical analysis of the privacy statements of 505 German FinTech firms and how they were adapted after the General Data Protection Regulation (GDPR) entered into effect in May 2018. The analysis also includes 38 expert interviews with relevant stakeholders from supervisory and regulatory authorities, the financial and FinTech industry, leading consulting firms and consumer protection agencies. By adopting this approach, the book identifies key regulatory needs, offers a valuable asset for practitioners and academics alike, and shares intriguing insights for lawyers, economists and everyone interested in FinTech and data privacy.

Master's Thesis from the year 2021 in the subject Business economics - Investment and Finance, grade: 1,0, University of Warwick (Warwick Manufacturing Group), language: English, abstract: The internet and digitalization tremendously affected many economic sectors, and both take increasingly influence over the financial services industry in Germany. New founded start-up companies, so-called FinTechs, connect innovative technologies with financial products and services and attack established players of the financial industry. While the Fintech industry constitutes a new dynamic and short-living market environment, the innovative strengths of new market entrants put pressure on financial service companies and banks in Germany. To assess the importance and impact of FinTechs on the financial industry and economy in Germany, a comprehensive amount of data including market size and market structure is needed. Particularly against the background of associated chances and risks of growing FinTech industry, an examination of the market size and impact is of tremendous importance to examine the innovative potential of FinTech business models. Low interest rates and risky business models in the aftermath of the financial crisis proved a lack of innovative thinking of banks and financial service companies in Germany. Indeed, FinTechs tend to have a stronger focus on customer needs thus closing existing market gaps better than traditional banks. Undoubtedly, this observation manifests in corporate finance when traditional banks neglect small and medium enterprises as potential clients. Particularly in market niches, FinTechs establish digital marketplaces connecting customers and facilitating the consumption of core banking products and services. Recently, the European Union announced that existing market entry barriers for FinTech start-ups would be dispelled. After the enacting of Basel II and Basel III Schindele and Szczesny (2015) analyse that core banking activities such as e. g. credit lending for small and medium enterprises became less profitable and partly even unprofitable for banks. While Dorfleitner and Hornuf (2016) confirm that notion, they highlight that the promotion of FinTech start-ups is constrained with risks but to judge the chances and risks of collaborations between FinTechs and established banks. Indeed, sufficient research is required to investigate the FinTech market in Germany and to examine how financial innovations and digitalization can help incumbents.

"Banking is necessary, banks are not" – Bill Gates' famous statement from 1994 was not just provocative but also foresighted. With new technology-based providers, also known as FinTech businesses, a new player has entered the banking market and it contests the predominant role of traditional methods in financial services. Banks are now forced to ask themselves whether they can provide some additional value in comparison to digitalized FinTech companies. This applies especially to the field of retail banking. Stephan Hoppe describes the rise of the FinTech industry and outlines its impact on selected business segments of the German retail banking market. In this way his publication elaborates the threats but also the opportunities for the retail banking industry. Content: - FinTech; - retail banking; - financial services; - digitalisation; - financial technology

Master's Thesis from the year 2015 in the subject Business economics - Banking, Stock Exchanges, Insurance, Accounting, grade: 1.3, Technical University of Munich (School of Management), course: Innovation and Business Creation, language: English, abstract: The impact of the financial crisis was a challenge for international and German banks and a test for the robustness of their business models. The consequences were stricter financial regulations introduced by Basel III and banks were forced to reduce proprietary trading and to refocus on traditional core banking business. Today supervisory authorities require sufficient and appropriate risk management systems to ensure financial stability and thus the internal operational complexity has increased and generates additional costs. In the aftermath of the financial crisis some banks are still struggling to regain competitiveness in combination with diminishing margins. In particular those banks are challenged with high dependency from interest income by deposit-financed retail banking business. In recent years financial technology companies, commonly known as FinTech, gained more importance in the financial industry and challenge banks and established business models. Digitisation is advancing in all industries and the music and media industry has already experienced a painful transformation process and a similar development is expected as well for the financial industry. Depending on how revolutionary the technological innovation is the more intense will be the impact on business models and in consequence fast adaptability is essential. The level of activity within FinTech is enormous at the moment in Germany and over one hundred new companies were launched in 2014. As a consequence digital business models are analysed with respect to core competences and how FinTech generates benefits for customers by improving the value with innovative digital solutions.

Get a handle on disruption, innovation and opportunity in investment technology The digital evolution is enabling the creation of sophisticated software solutions that make money management more accessible, affordable and eponymous. Full automation is attractive to investors at an early stage of wealth accumulation, but hybrid models are of interest to investors who control larger amounts of wealth, particularly those who have enough wealth to be able to efficiently diversify their holdings. Investors can now outperform their benchmarks more easily using the latest tech tools. The WEALTHTECH Book is the only comprehensive guide of its kind to the disruption, innovation and opportunity in technology in the investment management sector. It is an invaluable source of information for entrepreneurs, innovators, investors, insurers, analysts and consultants working in or interested in investing in this space. • Explains how the wealth management sector is being affected by competition from low-cost robo-advisors • Explores technology and start-up company disruption and how to delight customers while managing their assets • Explains how to achieve better returns using the latest fintech innovation • Includes inspirational success stories and new business models • Details overall market dynamics The WealthTech Book is essential reading for investment and fund managers, asset allocators, family offices, hedge, venture capital and private equity funds and entrepreneurs and start-ups.

Master's Thesis from the year 2020 in the subject Business economics - Banking, Stock Exchanges, Insurance, Accounting, grade: 1,3, , language: English, abstract: This study aims to identify the current state of adoption in German banks and critical factors for traditional institutes that need to be considered when it comes to the implementation of Robo Advisory solutions. Data were collected via a questionnaire that was filled by banking employees in Germany. Factor Analysis revealed the result that selection criteria are a very important factor for banks when they decide to acquire a Robo Advisory company or cooperate with such a Fintech firm. Especially characteristics like the performance, reputation, willingness to share sufficient information and technological capability of a Robo Advisory company need to be considered. The study also revealed that the IT-infrastructure of traditional banks is often not compatible with the technology offered by Robo Advisors. This can lead to problems in the integration process and need to be an aspect in the initiation phase of such a project. Robo Advisors are one example of Fintech companies that recently have moved into the financial industry and challenge traditional banking institutes with their business models. Mostly, Fintech companies are only operating in one field of banking and try to attract customers via internet-based offers that focus on simple user interface, efficiency, transparency and automation. Robo Advisors are companies offering automated financial investment tools and can therefore be located in the segment of asset management and investment. Relevant literature has stated the need for traditional banks to react in form of cooperation with such companies, acquisition of Robo Advisors or creation of own automated investment solutions.

The Financial Sector Assessment Program (FSAP) conducted a focused review that primarily assessed banking regulation and supervision of Germany’s less significant institutions (LSIs).1 Germany accounts for 1,324 of about 2,400 total LSIs in the Euro Area (representing 40 percent of Germany’s banking sector assets and approximately 55 per cent of total Euro Area LSI assets). As Germany is part of the Euro Area, the regulation and supervision of banks takes place within the European Central Bank’s (ECB) Single Supervisory Mechanism (SSM). The Federal Financial Supervisory Authority (BaFin) and the Deutsche Bundesbank (BBk) are responsible, under the oversight of the ECB, for the supervision of LSIs.