Financial technology (FinTech) allows fiduciary companies to use innovative technologies to expand their offerings and better meet the needs of tech-savvy clients. In this blog post, you can read about how FinTech is changing the fiduciary industry and what this means for your fiduciary business.

Instant money transfers, verification of solvency in a few hours instead of several days or even weeks, more socially responsible investment practices or more transparent crowdfunding: FinTech has transformed numerous business areas around the world, such as payments, lending, investment management and fundraising. According to the “Swiss FinTech Map“, in spring 2023 there will be around 370 FinTech startups in Switzerland. If you pay with your smartphone or send money via an app, you are using FinTech solutions. The best-known FinTech companies include the European neobanks Revolut and N26, the mobile payment systems Twint and Sonect, and the online real estate marketplace Crowdhouse.

Almost every day, new pilot projects and product tests between well-known financial institutions and up-and-coming FinTech startups make the headlines. In most cases, the goals of these collaborations are more efficient operations, increased innovation, better customer experiences, and more cyber security. Many major international banks and insurance groups realized years ago that a strong FinTech ecosystem would help both traditional companies and agile startups move forward. In this country, in the banking sector, Hypothekarbank Lenzburg, Julius Baer or Raiffeisen Switzerland, among others, and in the insurance industry, Axa, Baloise and Generali are known for their openness to FinTech startups and solutions. In the trust industry, on the other hand, many long-established trust companies are still skeptical of new market participants. Quite a few fiduciaries perceive the emerging tech companies and their accounting solutions, which seem disruptive at first glance, as competition. However, innovative technologies do not primarily mean the elimination of work, but rather a shift.

Reading tip: In this blog post, we show how the role of fiduciaries is changing as digitalization advances.

These are the opportunities of FinTech for the trust industry

The targeted use of FinTech can open up new opportunities for fiduciary companies to respond to changing customer expectations and make their business model more sustainable. With digitalization, the expectations of fiduciary clients have changed significantly. For example, it is a trend across industries that more and more SMEs want to do everything from document exchange to accounting to communication with their fiduciary company via a single platform. Digital-savvy executives in particular are increasingly demanding total solutions. The whole process should work seamlessly and be completely digitized. With each passing year, more digital natives are taking on leadership positions in SMEs, further increasing the demand for digital and integrative fiduciary solutions. Fiduciary software simplifies collaboration with your increasingly tech-savvy clients.

How this can look in practice is illustrated by the process of exchanging receipts with your clients. Requesting and processing receipts still costs fiduciary companies (too) much valuable time that could be used more profitably elsewhere. FinTech can empower you and your team to focus more on your core business instead of chasing receipts. With the Swiss fiduciary software Accounto, your clients can upload receipts to Accounto with just a few clicks, where your team can view them. Data exchange via Accounto also reduces the risk of sensitive data being lost or compromised in the event of lost work equipment, hacker attacks or an IT disaster. Your client:s data is kept in Switzerland and secured in a Tier 3 data center. A Tier 3 data center has multiple paths for power and cooling, as well as systems for upgrades and maintenance that can be performed on the fly. Availability is 99.98 percent. As a software provider, Accounto takes care of cyber security as well as backups and creates an IT emergency plan (disaster recovery).

In the future, efficiency in evaluating data will be decisive for the success of a company

According to a study by Accounto and Treuhand Suisse, even with the advent of seemingly revolutionary technologies such as new FinTech apps and tools, fiduciary companies remain the central point of contact for all business and financial concerns of the companies they serve. FinTech, as described above, allows more focus on those activities that generate recognizable added value for your client:s. Instead of performing repetitive accounting tasks, the focus is increasingly on being able to offer tailored advice and analyses.

The above-mentioned study by Accounto and Treuhand Suisse shows that the next generation of fiduciary clients places significantly more value on advice and the filling of specific knowledge gaps by fiduciary professionals than on performing routine activities. In addition to the ability to automate repetitive tasks, FinTech allows your fiduciary to analyze data more efficiently than ever before. This will be critical in the coming years as demand for customized reporting and analysis from SME clients continues to grow. If your fiduciary company can offer reporting and analysis services cost-efficiently, this will give you a competitive advantage. On the other hand, this also means that you may lose mandates if your competitors offer better data analysis in less time and at a lower price than your fiduciary company.

What can you do to avoid being left behind by the competition? As a leader, follow developments in the tech space closely and test new FinTech solutions with your team. How much time can you save per week or month by outsourcing accounting tasks with high automation potential to fiduciary software? Which technologies help your employees work more efficiently and effectively? To what extent can FinTech support you in aligning your offering with the needs of tomorrow’s customers, and thus

Engage with our technology experts specializing in the fiduciary industry and find out how FinTech can help you make your business model more sustainable.