For established financial institutions, the warning signs are flashing.
So-called embedded finance – a fancy term for companies integrating software to offer financial services – means Amazon can let customers “buy now pay later” when they check out and Mercedes drivers can get their cars to pay for their fuel
And that means they’ll be further away from the mountains of data others are hoovering up about the preferences and behaviours of their customers – data that could be crucial in giving them an edge over banks in financial services.
“Embedded financial services takes the cross-sell concept to new heights. It’s predicated on a deep software-based ongoing data relationship with the consumer and business,” said Matt Harris, a partner at investor Bain Capital Ventures.
Fintech is a fascinating niche. Instant money transfers are now possible through technology innovations. However, I am not interested in exploring the financial technology, but to replace the old banks with healthcare and the “embedded fintech” with healthcare – suddenly everything starts making sense.
In traditional hiring metrics for medical professionals. They require credentials (and fancy h-indices) primarily to recruit “rock stars”. What they don’t realise is that this model is increasingly getting redundant because the disruption has started from the edges. Technology companies have started making inroads via consumer technology – Apple Watch through wearables tracking some physical parameters, Amazon using its “embedded microphone” to listen to doctor-patient conversation and transcribing in real-time, and Google pushing the range of computational photography (through its pixel line) in healthcare as the underlying technology remains the same. These broad changes will eventually turn healthcare in a commodity. I reckon the inflection point around 2023-24 on how FTC can crack its whip on monopolisation of these firms and the attitude of the incoming administration.
Hospitals will become a place for treating “sick” but everything else- transactional data between healthcare providers (doctors) and patients will move online on the proprietary platforms. For those units which derive their income through “walk-ins” and “wellness” programs as “preventive healthcare packages” will have their cash-cow taken shepherded away.
The only way to stem this influx is to adopt and adapt to the new reality. These companies are likely to co-exist and mount aggressive PR campaigns (usually under the moniker of rising healthcare prices). Some will buy out the healthcare practices or insurance companies and drive more consolidation. The healthcare business landscape is shifting right in front of us.
Ask the banks. I haven’t visited a “branch” more than three times last year – only to get my debit card locked, changed and get a new one issued.