How the Fintech ecosystem changes with the entry of Big Tech companies

  • Received May 25, 2022;
    Accepted June 29, 2022;
    Published July 15, 2022
  • Author(s)
  • DOI
    http://dx.doi.org/10.21511/imfi.19(3).2022.04
  • Article Info
    Volume 19 2022, Issue #3, pp. 38-48
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This work is licensed under a Creative Commons Attribution 4.0 International License

The digitalization of financial services has led to the emergence of new, innovative services and providers. This paper first examines which actors are defined in the related literature as members of the Fintech ecosystem and what their roles and responsibilities are. A common element in the literature reviewed is that traditional financial institutions, startups, regulators, the investment community, and technology developers are identified as actors in Fintech ecosystems. The analysis then highlights how the large technology companies that are referred to in the literature as Big Tech (Meta (Facebook), Apple, Microsoft, Amazon, Alphabet (Google), Baidu, Alibaba, and Tencent) have become active in the financial services sector. It also examines which comparative advantages have led to the possibility for Big Tech companies to become third-party and then independent providers of financial services. As a result of their previous activities (software development, marketing, social media, online retail, and content services), they have acquired both a significant global customer base and outstanding IT development capabilities. These factors have enabled them to interact with former members of the Fintech ecosystem. They have formed partnerships with traditional financial institutions, then become their competitors, and they look to Fintech startups as acquisition targets. These factors determine Big Tech companies to become part of the Fintech ecosystem as a competitive service provider. From a practical point of view, these phenomena emphasize the need for the regulatory efforts on Big Tech companies.

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    • Figure 1. Revenue of Big Tech companies in different sectors
    • Table 1. Financial services offered by Big Tech companies
    • Table 2. Top Big Tech Fintech acquisitions
    • Table 3. Key actors in fintech ecosystems
    • Table 4. Competitive mapping
    • Conceptualization
      András Bethlendi
    • Formal Analysis
      András Bethlendi
    • Methodology
      András Bethlendi
    • Software
      András Bethlendi
    • Validation
      András Bethlendi
    • Writing – review & editing
      András Bethlendi
    • Investigation
      Árpád Szőcs
    • Project administration
      Árpád Szőcs
    • Resources
      Árpád Szőcs
    • Visualization
      Árpád Szőcs
    • Writing – original draft
      Árpád Szőcs