In a recent Salesforce study, 26% of millennials, 28% of Gen Xers, and 23% of baby boomers who have an account with a bank stated that they strongly or somewhat disagree with the statement that the banking industry is innovating at the same pace as other industries such as healthcare or retail.

This might be the reasons why FinTech companies are seizing the opportunity. A couple of weeks ago I had an opportunity to deliver a presentation on design thinking, and discuss how the financial services industry is being disrupted from the outside, during a digital transformation workshop organised by Found.ation and EIT Digital in Athens, Greece.

The United Kingdom has a long history of retailers being able to successfully expand their offering to banking services, insurance, credit cards, and more. For example, we have: 

  • Sainsbury's Bank - now wholly owned by Sainsbury's
  • Tesco Bank - wholly owned by Tesco plc since 2008
  • Asda Money - who attaches its own brand to products provided by other companies, like car insurance or credit cards
  • Co-operative Bank - the Co-Op Group owns a 20% stake
  • M&S Bank - formed by Mark & Spencer but operated by HSBC Bank since it was sold in 2004

In this article, I will discuss how the world's largest ecommerce companies are disrupting the financial services space. 

The first example that comes to everyone's mind is Amazon, as it seems that there isn't much the company cannot do these days. Apart from being the largest ecommerce platform and a leader in cloud computing, Amazon has a relatively strong footprint in financial services:

  • Credit cards 
  • Amazon Payments - allows online vendors to make payments across the US and Europe
  • Amazon Loans - extends short-term credit to small and micro businesses selling on Amazon's marketplace. 

For the remainder of this article, I will turn my attention to Asian ecommerce companies, as they take it a step further...



Rakuten Ichiba, formed by Hiroshi Mikitani, is the largest ecommerce site in Japan and one of the largest in the world. Rakuten these days is much more than an ecommerce platform. It has a footprint in media, video-on-demand, mobile messaging, ereading, travel, fashion, marketing and even sport (Tohoku Rakuten Golden Eagles, one of the top performing teams of Nippon Professional Baseball's Pacific League is based in Sendai, where I used to live).

What you may not know about Rakuten, however, is that is the firm operates the largest internet bank in Japan. It issues credit cards to tens of millions of members and offers financial products and services that range from personal accounts and mortgages to securities brokerage and insurance. 

Rakuten also has an electronic currency, Edy, which is embedded in its customer reward point system. The idea is simple - the more you buy, the more points you receive that can be used to make purchases online and with participating retailers.

Rakuten was one of the first players in electronic payment (MailMoney back in 2002 allowed users to transfer money via email), one of the first money transfer services via Facebook, one of the first Japanese investors in Bitcoin and blockchain and also a prominent venture capitalist.

While Rakuten is slowly growing outside of Japan, its dominance in Japan is unquestionable. The firm was able to leverage the large audience they have built and provide new services for them. To quote from Clayton Christensen's The Innovator's Solution: Creating and Sustaining Successful Growth, “(f)ocus is scary—until you realize that it only means turning your back on markets you could never have anyway. Sharp focus on jobs that customers are trying to get done holds the promise of greatly improving the odds of success in new-product development.” 



Alibaba, formed by Jack Ma, is a Chinese ecommerce, retail, and technology company that has experienced incredible growth. The company's market cap stands at over USD$486 billion and it's one of the most valuable companies in the world.

One of the smartest moves of Alibaba was a launch of Alipay, a mobile and online payment platform that launched in 2004 that overtook PayPal as the world's largest mobile payment platform in 2013.

Alipay has over 450 million registered users and over 200 financial institution partners. To quote from the company's website “Alipay has become an open platform integrating various consumption scenarios and industries like payment, lifestyle services, civil services, social networking, wealth management, insurance and public welfare. Alipay has evolved from a digital wallet to a lifestyle enabler.”

What you might not know, is that Ant Financial Service Group, that operates Alipay, has a number of other companies in its portfolio including

  • Ant Fortune - a wealth management app
  • MYbank - a private online bank focusing on small and micro enterprises
  • Zhima Credit - an independent third-party credit filing and scoring service provider
  • Ant Financial Cloud - an open platform providing cloud computing services for financial enterprises.

Similarly to Rakuten, Alibaba was able to identify correctly the jobs its customers wanted to get done, and moved quickly to a position of a leader. To quote Christensen again, “(w)hen a company identifies how to integrate the processes needed to give the consumer a sense of job completion, it can blow away the competition. A product is easy to copy, but experiences are very hard to replicate.



Tencent is technically a technology company but has a strong footprint in ecommerce. Founded in 1998 by Ma Huateng, Zhang Zhidong, Xu Chenye, Chen Yidan and Zeng Liqing, the company provides services ranging from gaming and music to social media and mobile payment.

The product that most of you might know is WeChat, the most popular social mobile application in China. Tencent has correctly identified an opportunity to grow the platform and started offering official accounts, city services (like booking a doctor appointment), news, and ecommerce solutions.

With all the services being offered, Tencent has also decided to launch WeChat Pay, which is now one of the most popular payment methods in China. In a recent interview with Tech in Asia, Wang Pengbo, a finance analyst at research firm Analysys, said that “(b)ecause of WeChat’s traffic and social advantage, in these past two years, WeChat Pay has become Alipay’s biggest competitor.

While Alipay has a higher market share, Tenpay, which includes WeChat Pay, had almost double the number of active users.

According to Financial Times, “China’s mobile payments hit $5.5tn last year, 50 times the size of the US’s $112bn market, based on Forrester Research figures.”

Tencent's idea was simple yet powerful - making payments as easy as sending a message. As Christensen states in Competing Against Luck: The Story of Innovation and Customer Choice, “(n)ew products succeed not because of the features and functionality they offer but because of the experiences they enable.” 


New Opportunities

The key message I wanted to convey in this article is that irrespective of your industry, you are now competing in a world of sectors without borders. These days it is hard to distinguish between technology and non-technology companies and the same applies to financial services and other industries.

Companies like Tencent, Alibaba or Rakuten are disrupting the industry by focusing on the customer and leveraging the changing customer expectations. By creating a unified value proposition and emphasising customer-centricity, the new entrants are providing their customers with new experiences and shifting their expectations.

For me, it is apparent that the effects of the re-defined boundaries and the new competitive landscape are profound. The new landscape starts filling up with non-traditional players being able to provide their customers with more diverse multi-industry solutions. In my opinion, the recent shift opens opportunities for everyone: the incumbents, the FinTech companies, and companies that predominantly operate in a different sector.

The customers are expecting fully personalised solutions delivered quickly. Technology is an enabler for change, but to win the race you might need to change your mindset and the way your brand operates.

Take your first step towards customer-centricity by understanding what customers want from a modern bank in the 2017 Connected Retail Banking Report.