FinTech's Push into Adjacent Banking Services Creates Challenges and Potential Consolidation

This IDC study shows how fintech's expansion into adjacent banking services is reshaping the retail banking landscape, driving disruption beyond products to focus on CX. As fintechs and nonfinancial companies embed financial capabilities into their platforms, traditional banks face challenges in maintaining customer engagement and relevance. The shift is propelled by rising customer expectations, demand for contextual financial support, and economic pressures, especially among younger demographics. Although fintechs excel at targeted, digital-first solutions, they must navigate regulatory hurdles and operational complexity as they scale. Banks, meanwhile, risk disintermediation unless they modernize and prioritize omni-channel, personalized experiences. The evolving market may lead to consolidation and deeper service integration, with trust, privacy, and customer-centricity as critical success factors.