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Blockchain Technology and New Business Models for Banks in the Financial Services Industry

Blockchain Technology and New Business Models for Banks in the Financial Services Industry

Vincent Sabourin (ESG University of Quebec at Montreal, Canada) and Mike Cyrille Aka-Brou (ESG University of Quebec at Montreal, Canada)
Copyright: © 2021 |Pages: 38
DOI: 10.4018/978-1-7998-7110-1.ch001
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Abstract

In recent years, the financial technology of blockchain has become a disruptive innovation that is transforming the management of banks. If blockchain represents an opportunity for financial services, it also represents a severe threat of financial disintermediation. What are the business models available to banks when deploying a business model to integrate the blockchain technology? In this chapter, the authors surveyed the strategic intent of 45 international banks for blockchain technology and analyzed the different business models that might facilitate a management transformation for the banking industry. They developed a taxonomy of five different business models. They were labeled as the following: the coordinators, the integrators, the solution providers, the disrupters, and the explorers.
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Theoretical Background

Research has argued that FinTech is a substantial factor contributing to the management transformation of business models for the financial services industry. Puschmann (2017), defines them as “incremental or disruptive innovations in the context of the financial services industry induced by IT developments resulting in new intra- or inter-organizational business models, products and services, organizations, processes, and systems.”

For their part, Eickhoff et al., (2017) defined FinTech as a combination of the following characteristics: (i) information technology that is often (ii) startups with (iii) their innovative product or services.

Alongside the gamut of financial industry, FinTechs are looking for new pathways to design successful business models that could yield a significant management transformation. Industry and academic observers believe this connate to a revolution for financial services leading to radical improvements in efficiency, customer centricity, and informedness provided by these new financial technologies (Gomber et al., 2018). These financial technologies have attracted much interest since they challenge incumbent financial service businesses and traditional banking intermediation. (Schmitt & Weber, 2017).

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