Over half (54 per cent) of traditional financial services firms are planning to splash cash on their IT systems, as the rise of fintech is leaving them quaking in their boots, research out today has found.
The study by Robert Half Financial Services also discovered that those who planned to plough more money into technology were considering boosting their expenditure by 15 per cent over the next 12 months to keep pace with more digitally-minded new entrants.
When financial services executives were asked who had them worried the most, online investment firms topped the list as the most disruptive business, garnering 26 per cent of the vote. Challenger banks and peer-to-peer lenders came in second and third place, scoring 24 per cent and 16 per cent respectively.
"Digital transformation plans are ramping up among both the front and corporate offices of financial services firms, largely the result of competition from the fintech industry," said Luke Davis, vice president of Robert Half Financial Services UK. "This reaction is seeing established firms review their traditional models to offer customers, clients and employees new services using innovative technologies."
Executives are particularly worried the rise of fintech will result in them losing out in the war for talent. Nine out of ten (91 per cent) of those asked said they were concerned growth in the fintech sector would negatively affect their ability to secure the right staff, while 35 per cent said they were very concerned.
However, it isn't just getting people through the door that has executives worried, with 85 per cent of those questioned saying they feared their high performers leaving them for digital pastures new.
Davis added: "Financial services professionals with experience of managing digital projects, such as enhancing the customer experience through digital technologies for mobile, tablets and wearable devices are in hot demand, particularly for interim roles, as firms seek to create digital solutions that are both innovative and compliant."