Robo-advisers and new payment systems are early examples of the disruptive power of fintech, but innovations will also improve customer experience and lower costs to serve, so the impact on profitability is difficult to predict.   

“I don’t think there’s a part of banking where you won’t see tech changing either the customer experience or the operating model,” said Rob Jesudason, Group Executive, International Financial Services, Commonwealth Bank of Australia.

Other panelists stressed that fintech companies strive to add efficiency to banking systems, which is good for bank customers.

“The right word isn’t disruption. The right word is innovation,” said Nick Nash, Group President at Garena, which provides digital financial services. “The single biggest opportunity is not: how I can take away revenue from banks, it’s: ‘how can we serve markets banks have abdicated or ignored.”

Whether fintech is expanding the banking business or taking a chunk, it’s clear that the industry is growing rapidly. An example is Ant Financial Services Group, Alibaba’s finance arm, which has been valued at approximately US60 billion.

Cyril Han, a Vice President at Ant Financial, was asked when the company planned to go public. Han replied that an IPO plan hadn’t been formalized as yet, and downplayed the importance of raising capital or establishing a market valuation. The more important benefit of going public would be raising its legal requirements for transparency, which would increase trust in its business.

“Becoming a public company is the best way to become more transparent. Trust is the most important thing to banks,” Han said.

For those banks that still fear disruption, the best course is to scale up your own fintech systems and then continually disrupt yourself with new features that improve customer experience.

“If you don’t do it, one of your competitors is going to do it,” Jesudason said.