FinTech sector and banking business: competition or symbiosis?

Introduction. The rapid development of the digital economy at the national and worldwide levels in recent decades has accelerated processes of transformation of financial systems and led to financialiation of the global economy. FinTech companies operating in the financial market represent a new, quite special category of parabank institutions. They are characterised by the implementation of modern technologies to develop and provide traditional financial services. It would not be possible to provide such services without the Internet and digitalisation, compatibility of electronic devices, including hardware and software, nor would it become possible without new experiences, skills and consumer confidence. This is a kind of analogy with search engines that have changed the architecture of the market and mediation and led to the transformation of business models of financial market entities, in particular banks. Purpose. This paper presents the results of the possibility of providing financial services without banks. It determines the main aspects of competition and directions of combining FinTech and banking. Methods. In evaluation the FinTech and banking sectors, the authors have used statistical monitoring, as well as dynamic, comparative and structural analysis. Results. The results of the study show that FinTech allows creating new services that are not provided by traditional financial intermediaries. It has been proven that the limits for FinTech companies to avoid banking rules and regulations are expanding, and it is becoming increasingly difficult to prove that this is happening beyond the law or outside the law. An analysis of the global trends in the development of the FinTech industry has shown that the volume of investments in this area in 2018 was USD 111.8 billion, which is almost 6 times more than in 2013. The authors examine the main forms of interaction between banks and FinTech companies. Basic models of banks’ participation in the creation of FinTech companies are substantiated. The authors of the article have analysed characteristics of the largest FinTech accelerators, identified and characterised the main risks and opportunities relating to FinTech for the banking and consumer sectors. Conclusions. The presented paper reveals the modern trends in FinTech development. They should be taken into account in defining the key determinants of the transformation of the banking sector in relation to the formation of new business models of banks with regard to the challenges of digitalisation.