Could Facebook/bank destroy the retail banking giants?

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I have written a few articles recently about how large internet companies like Google, Facebook and Twitter could be the biggest threat to retail banks for many of their services.

Facebook is moving into financial services. Read this article I wrote.  In the meantime banks are struggling with a lack of consumer confidence, pressure from regulators and creaking IT systems.

Why shouldn't a massive internet firms offer a current account for example? They have the technology and the customer trust. They already hold lots of customer details. Retail banks like RBS, lumbered with legacy IT, might end up being just B2B, leaving internet firms to offer retail banking services.

A good contact of mine in the banking sector believes major change is on the horizon.

He said: "I think Amazon, Ebay and Paypal will become banks soon."

"The dinosaur banks won't be around in 10 years except for business to business products. Cost base too high and service level too low combined with poor reputations and pressure from regulators, governments, public and media. The writing is on the wall, extinction is inevitable, but they are in denial at the moment."

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This page contains a single entry by Karl Flinders published on April 15, 2014 10:06 AM.

I hope Amazon's pay as you go cloud is easier to cancel than Lovefilm was the previous entry in this blog.

Steria and Sopra merge to get on more supplier lists is the next entry in this blog.

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