Description: Technology disrupts. Ask the taxi drivers upset with Uber. Or the hotel owners coping with competition from Airbnb. Now the banking industry is concerned that so-called fintech startups may cause users to question the value of a relationship with a traditional bank. For example, new payment processors are offering businesses much lower transaction fees for credit card processing than the traditional banks.
Date: January 2, 2016
1) What’s your opinion of the fintech movement? Will it threaten the big banks?
2) The article speaks of 80 to 90% gross margins on some financial products. How would you calculate a gross margin on the sale of financial products? What would be some of the components of the cost of sales?
3) What are some of the key factors that would give these fintech firms a cost advantage?