Hieu Nguyen Cutting Through The Fog-Case Overview

Hieu Nguyen
Cutting through the Fog- Case Overview
1, What factor support growth of fintech and what challenge does the sector face?
The growth of fintech is supported by explosive growth of mobile technology and the 2008 crash of the
financial market. About the financial crisis 2008, this crisis did increase the disappointments about the
banking system along the time and financial cost when individuals use the banking service, leading to
the demand for the financial technology which could help people to use the financial services in a more
convenient, more secure, and faster way. The growth of mobile phone and internet access is also a
reason for the growth of fintech. During the period between 2006 and 2016, the CAGR of US and
Chinese internet users was 3.4% and 18.2%, respectively. By 2016, there were 1 billion internet users
from US and China.
There are four main challenges does the fintech face which are:
- Building trust with the clients

- Creating the collaboration with similar fintech business and banks
- Credibility, to build the positive and long-term relationship with the customers
- Enhancing the customer experience
2, Which business areas and product types are valuable for fintech growth
There are five business areas are valuable for fintech grow, which are:
- Lending: The demand for fintech lending is large when the number of smartphone users and
have the internet connection was over one billion by the end of 2016. Moreover, people are
asking for the cheap, fast, convenient, and secure factors in lending services; the majority of the
traditional banks cannot have those factors when they provide lending service, thus the demand
of fintech in lending is very large.
- Payment: The demand for quick, secure, and convenient to pay for the online purchases or
transferring money is high, especially when we are in the era of e-commerce and digitals.
Therefore, this business area is very valuable for the growth of fintech.
- Personal finance: personal finance is used to support the financial goals or retirement plans.
However, not many could do person finance, there I believe the demand for fintech in personal
finance is very high since fintech can access the big data and be able to support humans in
making personal finance.
- Insurance: Normally, it takes a lot of time and efforts to sell one insurance plan for the clients. It
is also so hard for clients to find the suitable insurance plans. With fintech, all those issues will
be resolved when fintech can use historically data, calculate risk and financial assessment to find
the best insurance plan which meet the mutual goals of clients and insurance companies.
- Regulatory technology: The financial cost related to consulting financial regulations is very
costly, however, the demand for that service is very high. Therefore, I think this business area is
very valuable for fintech to growth.
3, List the pros and cons of each options. Which option do you recommend?
Option Advantage Disadvantage

Option 1: Doing nothing Save time and effort to spend Maybe lost the customer due to
on finding partner or acquiring the customer service or the
strategy. service/product do not meet
the demand of the customers.
Not be able to catch the change
in customer preference
Option 2: Acquire fintech firm Be able to use the asset of Costly and the acquiring risks
fintech firm to combine with might happen. The debt-to-
company’s customers data to equity issue could happen if the
have appropriate business firm use debt to finance the
strategy acquisition
Option 3: Convert current IT Similar to option 2. The business Take a lot of time to training.
and strategy to become a can fully control its fintech and High monetary cost. Might
fintech company be able to apply fintech in its affect the brand image of the
customer data. company
Option 4: Partner with fintech Be able to use partner fintech Have to sharing profit with the
companies to serve customer assets and combine with partner. Depend on partner
company data which can help technology
the managers to have the right
business strategy.
Recommendation: My recommendation is to pick Option 4: Partner with Fintech company. This method
help the business to save the cost and still be able to use partner technology to combine with customer
data to improve the customer experience as well as be able to gain the market share.

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Hieu Nguyen

Cutting through the Fog- Case Overview

- Building trust with the clients

Option Advantage Disadvantage

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