Future of fintech careers
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Careers in the fintech sector are in a state of flux

1 Dec 2016

Fintech has become the new poster child of the financial industry, but what does it mean for those working in banking or insurance? Are jobs under threat or is a new wave of tech roles about to land?

Maintaining jobs in the fintech sector is a balancing act. Over the last number of years, fintech has become the star of the show. With fintech start-ups constantly developing, and increasing investments being poured into the alternative finance sector, the financial careers of old have been forced to adapt or make way for new roles altogether.

As with most technological advances, the question on people’s lips is: will it decimate jobs in the sector or replace humans with automation? The answer is never a simple yes or no.

Feeling threatened

There has been much discussion around the threat of fintech on current jobs in the financial sector. Banks have a tendency to cut jobs in favour of automation for efficiency and lower costs. European banking giant ING recently cut 7,000 jobs in line with its digital transformation.

In the insurance sector, there’s even more worry among industry professionals. For example, Zurich Insurance Group is planning to save at least $1bn by the end of 2018, with changes that will affect about 8,000 jobs.

German insurance company Talanx is spending €300m to upgrade technology over the next four years and estimates that this will reduce annual costs by 240m by 2020. It also plans to cut at least 12pc percent of the workforce at its German retail unit.

When it comes to banking, technology is changing the traditional model, transforming customer relations and placing importance on collecting and understanding data. Meanwhile, new fintech start-ups and alternative finance companies are jumping on the new gap in the market, as traditional banks scramble to keep up.

According to Accenture, “Digital disruption has the potential to shrink the role and relevance of today’s banks, and simultaneously help them create better, faster, cheaper services that make them an even more essential part of everyday life for institutions and individuals.”

Adaptable roles

There is no need for financial professionals to despair, and graduates are looking at a market that is rife with new technology jobs, thanks to the expanding fintech sector.

Between 2010 and 2015, global investment in fintech ventures rose from $1.8bn to $22.3bn. During that same period, the number of fintech deals more than tripled, from 269 to 896. Even in the first quarter of 2016, global investments in fintech had a 67pc increase compared to the same period last year.

North America leads the way with $11.4bn – more than half of total fintech investment around the world – but the industry is strong closer to home as well.

Ireland in particular is a hotbed for fintech innovation, according to KPMG. Its head of technology, media and telecommunications, Anna Scally, said, “We have 30,000 people working in financial services and another 100,000-plus in technology. This gives us a critical mass in the two sectors.”

While the tech skills gap is causing problems, Ireland is still faring better than other countries, with talented people who have strong technology and finance backgrounds.

Additionally, the Government is putting fintech at the forefront of its plans. Fintech is a core component in the International Financial Services Strategy 2020, and this support has enabled a number of strong fintech start-ups to join the financial fray.

It’s a very interesting time for fintech careers. Retraining or upskilling in technology will certainly give existing employees a competitive edge, as the top traditional financial giants are heading towards innovation. Meanwhile, new graduates might look to fintech start-ups to learn the changing trends on the job.

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Jenny Darmody
By Jenny Darmody

Jenny Darmody became the editor of Silicon Republic in 2023, having worked as the deputy editor since February 2020. When she’s not writing about the science and tech industry, she’s writing short stories and attempting novels. She continuously buys more books than she can read in a lifetime and pretty stationery is her kryptonite. She also believes seagulls to be the root of all evil and her baking is the stuff of legends.

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