As featured in Financial Brand, February 2022:
Fintechs are not new, but for community banks and credit unions, perhaps for the first time, it’s getting personal. For years, fintechs have largely threatened big banks. But as fintechs take on lending - even Walmart is getting financial services - traditional financial institutions are feeling the impact of fintechs in new ways they cannot afford to ignore.
The data reflects the trend. The past decade has seen a tremendous shift, with the amount of loans originated by fintechs increasing by nearly 10 percent.
According to Kasasa, a financial technology and marketing services company that works with community financial institutions, seven years ago, fintechs originated 5% of total loans, 43% were originated by credit unions and 52% of loans were originated by banks. Today, banks are down to 30%. Credit unions are down to 23%. And, fintechs are up to 44%.