While it was once a buzzword that was used in the financial industry, FinTech has grown to become a significant influence in the financial sector. FinTechs which are companies that develop and utilize technology to enhance and enhance conventional financial service, are now the most recent and innovative disruptive force in the industry. Historically agile start-up companies born from a desire for creativity and innovation and have since evolved to extremely attractive employers, entice people to change sectors and jobs, most of the time from banks.
Many might blame the “great resignation’, however the reality is that the top talent has been migrating into FinTechs in a masse after the global financial crisis of 2008. Since 2008 the shift has become more more apparent as the COVID-19 virus has been that brought it to the forefront with huge shifts in employment across various sectors. As per Forbes FinTech 100, FinTech companies are most popular in the field of payments and transactions as well as credit and lending as well as wealth and brokerage. However, they are also growing in various financial areas which include mortgages, blockchain and Neo-banks.
As FinTech is growing at the rate it is currently and continues to expand, what is the the future for traditional banks will soon be turned upside down which could see banks become the backstage setting that is controlled for the FinTech sector. If banks as well as other financial institutions want to keep top talent in place and attract fresh talents, it’s crucial to comprehend the reasons why employees are shifting to FinTechs and what actions can be taken to slow the flow.
The FinTech Appeal
Inspiring and Excited in the FinTech sector
Brilliant minds are drawn by the thrill of intrigue which is why the FinTech sector gives them the latest and innovative workplaces where they can push the boundaries and discover the realm of finance and technology. The chance to work on and work with the latest technology is what makes working in FinTech extremely exciting and enjoyable. The FinTech sector also permits employees to discover new opportunities and create new avenues in an old-fashioned system. The concept of taking calculated risks is expected , and the status quos are designed to be shattered.
Very Publicized and Low Risk Valuations
One of the major reason for the move towards FinTech is the lower risk involved in the FinTech sector. FinTech has experienced constant growth and rapid growth, with companies like Klarna recently achieving an valuation of nearly $30 billion in 2021. Before the COVID-19 epidemic Some of the brightest minds in the field of financial services noticed the rise of organizations such as Square which was founded through Jack Dorsey of Twitter fame. Klarna and Venmo served as proof of their theories – that FinTech was quickly becoming a profitable and stable sector that was ripe for the influx of experienced veterans of the financial sector.
Creativity and Ubiquity
FinTech is all over the place and is a constant feature of our lives every day. One day, you could make use of apps on your mobile to scan and deposit a cheque, use another app to balance your budget across several accounts and banks, or make a request for transportation using an app for ride sharing, and then later, place an order for late-night meals using food delivery platforms. We’ve grown familiar with their existence and convenience, but we’ve also been awestruck by their existence as well as the ease and simplicity with our lives have been made easier. This universal attraction and accessibility to creativity is very appealing to those who wish to be at the forefront of what’s next.
Flexible Work from Home and Hybrid Opportunity
The FinTech industry also owes part to its ability in drawing best talent, thanks to the hybrid workplace. Before the COVID-19 pandemic was a reality, a few FinTech companies offered flexible policies for time off and unlimited annual leave, thus giving a more flexible work environment for their employees. After the outbreak and the “great resignation,” many people started to move out of their homes and major cities to areas with lower costs and join companies that provided remote work options. As we move the post-pandemic environment most FinTechs are who are willing to continue to operate remotely as traditional banks plan to let their employees back in the office. There are many excellent reasons for having employees working in physical offices however, since employees have adapted and enjoyed the flexibility that the remote work environment has provided Some are not ready to return.
Competitive Employee Benefits
As we have mentioned there is a substantial volume of cash is being pumped into the FinTech sector, assisting and supporting the growth. Due to this financial boom, FinTech companies are able to draw high-quality talent and retain employees with highly competitive packages. A majority of FinTech employees enjoy the same benefits of bankers with high salaries and also the advantages of a hybrid working environment with a more balanced work-life schedule and additional perks that aren’t typical such as on-site chefs and complimentary meals and quiet nap rooms which are not usually found in traditional financial institutions.
So, What can banks that are traditional do to halt the flow?
There is hope. Traditional banking could certainly model the changes happening in FinTech and adopt some new ideas to keep the best talent. Here are some of the most important tips:
1. Recognize the strengths of your business
The rapid growth of FinTech isn’t aiming to reduce the traditional bank in any manner. Actually, FinTech sees traditional banking as an open platform for innovations and heavily rely on the knowledge of individuals who work in banking. The banking industry must recognize this potential and adopt an approach that is more person-centered.
Additionally, employees are attracted by banks because of the vast number of opportunities, the possibility to start early, quick career advancement, long-term stability, potential for growth and great benefits, as well as compensation for financials, and fantastic working conditions and working time off.
It is important to be aware of the obvious post-pandemic shift that has occurred in the thinking process and attitudes of the typical employee. People are now searching for jobs that will provide them with more excitement and offer greater advantages. Therefore, traditional banks have to highlight their strengths if they want to stay afloat in this business’s transformation.
2. Review your areas of weakness
Banks should establish new evaluation methods to determine the areas they’re lacking in terms of retention of employees. Exit interviews, for example can be a fantastic way to determine the reason employees are leaving and find out more about what they would like to be able to see in their ideal workplace.
Small-scale FinTech firms are competing with banks along with tech giants such as Amazon and Microsoft in the search of skilled talents. These industries are particularly required to develop unique methods to provide their employees with great value. Flexible work arrangements and remote work setups are an excellent method to attract and keep individuals with a variety of backgrounds that are far away from the office.
3. Connect and Partner with FinTechs
Banks have access to huge financial resources that can help encourage innovation in developing innovative solutions to issues. Instead of competing with FinTechs and divisions, they can create divisions or groups that explore ways of working together with current FinTech groups.
Collaboration with flexible, innovative FinTech-related services can not only improve the bank’s offerings but also provide opportunities for current employees looking for newer positions and innovative ways to approach traditional banking. Through partnering as well as investing into FinTech innovations banks can prepare themselves for growth in the future and adaptability through real-time, accessible products such as services, data and channels. The bank is also portrayed as being digital-first and innovative and assists to ensure the future of the company overall.
Banks may also establish digital divisions inside their offices and bring together the most creative of their employees. But, working with an FinTech firm could be a more effective and more attractive option to access the technology required quickly.
Take into account the employee value
In the final analysis One of the easiest methods of retaining talent is to let your employees feel appreciated. If employees don’t feel valued for what they contribute to the company and contribute to the company, they will tend to place their talents elsewhere where their work and ideas will be cherished. Therefore successful businesses will always provide their employees with incentives, such as incentives or bonuses and give them the tools necessary to promote personal development. This will not just be noticed at the person level; but across the whole company. It’s an overall win-win situation for all.