Page Keyword Definition / Description
Network age is the transformative force of the last decade where interconnectivity
2 Network Age has been enabled by internet, smart devices, mobile communications, and the
decreasing cost of technology
Network effect refers to the positive returns that scale from additional participants
2 Network Effects joining the network, which result in the value of participating also increasing (as
there is more benefit and value to derive from the network)
The use of Network Age technologies within the industry and combining it with
2 Industry 4.0
data analytics is known as Industry 4.0
Big Data is the capturing and creation of data in the network age and has 4
2 Big Data characteristics (4 Vs), Volume, Variety, Velocity, Veracity, (and sometimes a 5th
V; Value)
One of the key digital technologies re-shaping finance, automation is the use of
3 Automation
technology to replace or complement humans
One of the key digital technologies re-shaping finance, analytics is the generating
3 Analytics
and visualising of insights using data analysis
One of the key digital technologies re-shaping finance, artificial intelligence is the
3 Artificial Intelligence
use of technology to analyse data and respond to those outcomes
It’s important that finance professionals have a digital mindset, and rethink entire
3 Digital Mindset business and operating models. This requires having a foundation level of digital
literacy. There is no need to become a computer programmer.
Enabling skills are those that are more general and adaptable, rather than narrow
and task specific. These include behavioural skills such as communications,
3 Enabling Skills relationship management, and strategic thinking, data analysis skills such as data
modelling, visualisation, and programming, and finance skills such as business
modelling, process design and financial analysis
Competitive advantage is being able to achieve better performance than
5 Competitive Advantage
comeptitors and defend that advantage over the long term.
Transient advantage is essentially the same as a competitive advantange but is
5 Transient Advantage temporary, recognising the fact that advantage cannot be sustained long term as
competitors copy you and catch up
, The Digital Finance Cube (Gomber, Koch & Siering, 2017) helps analyse the
interrelationships and enablers of:
1. Digital Finance Business Functions (most important dimension from business
5 Digital Finance Cube
administration POV)
2. Digital Finance Technologies and Technological Concepts
3. Digital Finance Institutions
Digital financing is the use of financing other than traditional services (i.e. banks).
6 Digital Financing These include invoice financing, electronic invoicing, lease-financing, and crowd-
funding
A form of Digital Financing, Invoice financing is selling your accounts receivable to
6 Invoice financing a third party to meet your immediate cash needs i.e. 20k outstanding invoice, you
get 18k now in exchange for a 10%/2k commission e.g. MarketFinance
A form of Digital Financing, Electronic invoicing is using technology to automate
6 Electronic Invoicing processing of invoices, allowing customers to settle accounts quickly and the
business get cash faster
A form of Digital Financing, Lease Financing is getting access to an asset for
6 Lease-financing
lease repayments without a large upfront cash outlay
A form of Digital Financing, Crowdfunding is raising money through small
contributions from a large number of people e.g. Kickstarter. It can also involve
6 Crowdfunding
crowd-sourced equity where shares are sold direct to investors on those
crowdfunding platforms
Digital investments support individuals or institutions to make investment
7 Digital Investments
decisions and arrange the investment transactions.
The use of platforms such as eToro to trade securities. These need fewer staff,
7 Online Brokerage
have lower costs, operate independently, and can process more orders
7 Mobile Trading Mobile trading is the trading of securities on your phone
Social trading is trading via internet platforms that allow you to copy other investor
7 Social Trading
strategies
Algorithmic Trading is high frequency without human intervention and using
7 Algorithmic trading
algorithms that can exploit market anomalies
Digital Money has no universally agreed definition but is agreed that it is in
electronic and not physical form. They can include traditional currencies or even
7 Digital Money cryptocurrencies (which are decentralised and hosted on a platform known as
blockchain that removes the need for a central intermediary to process the
transaction).
, Digital Payments are any payments initiated, processed, or received electronically
e.g. online banking, mobile payments, Peer-to-Peer payments between private
8 Digital Payments
individuals that immediately validate receipt of the payment (e.g. Paypal and
Google Pay), and Digital wallets (e.g. Google Wallet)
Mobile Payments use mobile technology to initiate and confirm payment, acting
8 Mobile Payments as a substitute for established payment structures e.g. Amazon, Apple, Facebook,
and Google
Peer-to-Peer payments between private individuals that immediately validate
8 Peer-to-Peer Payments receipt of the payment (e.g. Paypal and Google Pay). More complicated and
costly to recommend vs Open Loop Mobile Payments
Digital insurance platforms provide a range of value-adding services including
data analytics to allow clients to monetise and cross sell additional services.
9 Digital Insurance Alliances are formed and money is collected from them into a pool used to pay
small claims, saving administrative expenses for the insurance company.
Insurance company still deals with large pay-outs.
Digital Financial Advice is the use of review sites and comparison portals to
compare products and services and assess the reputation of financial service
9 Digital Financial Advice providers. It can also include Robo-advisors which generate investment
proposals/strategies given inputs provided (e.g. financial background, investment
goals, risk aversion, etc.)
Part of the Digital Finance Business Function dimension of the Digital Finance
10 Blockchain cube, Blockchain is a platform that provides an ordered, timestamped and secure
record of transactions, usually applied in cryptocurrency transactions.
Part of the Digital Finance Business Function dimension of the Digital Finance
cube, Social Networks are those that enable interaction and development of
10 Social Networks
networks via social media platforms e.g. focused platforms like LinkedIn and
general platforms like Facebook.
Part of the Digital Finance Business Function dimension of the Digital Finance
cube, NFC is a standardised Protocol that enables two devices to communicate
10 Near-Field Communication (NFC)
via radio frequency when brought close to each other (up to 4cm away).
Payments can be made using NFC.
Part of the Digital Finance Business Function dimension of the Digital Finance
10 Peer-to-Peer Technology cube, P2P technology is where resources and data are shared in a way that
avoids reliance on a central intermediary e.g. Blockchain is a P2P technology
Part of the Digital Finance Business Function dimension of the Digital Finance
10 Further Enablers
cube, Further (technological) Enablers that help facilitate financial processes,
, functions, and business models include fast internet connections, AI, intuitive user
interfaces, and automation technologies.
FinTech companies are usually start-ups or tech companies without history in
11 FinTech Companies financial services that have developed FinTech offerings that are more flexible,
efficient, and innovative than traditional service providers.
Traditional Service Providers include banks, insurance companies, and brokerage
companies, providing services on cash accounts, savings, and money
11 Traditional Service Providers
management. They need to innovate and defend their business against emerging
FinTechs.
Technology is where a company transforms information and data, human labour,
11 Technology
or economic capital into products or services of greater value.
11 Innovation Innovation is a change in the way technology is used.
Ten Types of Innovation Framework is a useful tool to improve potential or
developing innovation or analysing an existing approach. The Ten Types are
11 Ten Types of Innovation Framework categorised into Configuration, Offering, and Experience. These ten types include
Profit Model, Network, Structure, Process, Product Performance, Product System,
Service, Channel, Brand, and Customer Engagement
Lender-savers are those in a financial system whose income exceeds their
15 Lender-savers spending. This then indirectly or directly finances borrower-spenders. They can be
consumers, businesses, or government
Borrower-spenders are those in a financial system whose spending exceeds their
15 Borrower-Spenders
income. They can be consumers, businesses, or government
Direct financing is where funds move through financial markets e.g. large
15 Direct Financing
corporations selling securities/shares direct to lenders
Indirect financing is where institutions invest in financial assets and then collect
15 Indirect Financing money from lender-savers, aggregate the funds, and make loans in larger
amounts to other consumers, businesses, and government
Financial inclusion is the use of mobile smart phones that bring financial services
15 Financial Inclusion to people who previously did not have access or were not served by financial
institutions. More on page 27
FinTech 1.0 (2010-2014) began to pop up to use technology to target areas
underserved or overlooked by traditional banks. They focused on payment
16 FinTech 1.0
processing, generating new lending models using peer-to-peer structures, and
helping banks through personal financial management and risk modelling.
Network age is the transformative force of the last decade where interconnectivity
2 Network Age has been enabled by internet, smart devices, mobile communications, and the
decreasing cost of technology
Network effect refers to the positive returns that scale from additional participants
2 Network Effects joining the network, which result in the value of participating also increasing (as
there is more benefit and value to derive from the network)
The use of Network Age technologies within the industry and combining it with
2 Industry 4.0
data analytics is known as Industry 4.0
Big Data is the capturing and creation of data in the network age and has 4
2 Big Data characteristics (4 Vs), Volume, Variety, Velocity, Veracity, (and sometimes a 5th
V; Value)
One of the key digital technologies re-shaping finance, automation is the use of
3 Automation
technology to replace or complement humans
One of the key digital technologies re-shaping finance, analytics is the generating
3 Analytics
and visualising of insights using data analysis
One of the key digital technologies re-shaping finance, artificial intelligence is the
3 Artificial Intelligence
use of technology to analyse data and respond to those outcomes
It’s important that finance professionals have a digital mindset, and rethink entire
3 Digital Mindset business and operating models. This requires having a foundation level of digital
literacy. There is no need to become a computer programmer.
Enabling skills are those that are more general and adaptable, rather than narrow
and task specific. These include behavioural skills such as communications,
3 Enabling Skills relationship management, and strategic thinking, data analysis skills such as data
modelling, visualisation, and programming, and finance skills such as business
modelling, process design and financial analysis
Competitive advantage is being able to achieve better performance than
5 Competitive Advantage
comeptitors and defend that advantage over the long term.
Transient advantage is essentially the same as a competitive advantange but is
5 Transient Advantage temporary, recognising the fact that advantage cannot be sustained long term as
competitors copy you and catch up
, The Digital Finance Cube (Gomber, Koch & Siering, 2017) helps analyse the
interrelationships and enablers of:
1. Digital Finance Business Functions (most important dimension from business
5 Digital Finance Cube
administration POV)
2. Digital Finance Technologies and Technological Concepts
3. Digital Finance Institutions
Digital financing is the use of financing other than traditional services (i.e. banks).
6 Digital Financing These include invoice financing, electronic invoicing, lease-financing, and crowd-
funding
A form of Digital Financing, Invoice financing is selling your accounts receivable to
6 Invoice financing a third party to meet your immediate cash needs i.e. 20k outstanding invoice, you
get 18k now in exchange for a 10%/2k commission e.g. MarketFinance
A form of Digital Financing, Electronic invoicing is using technology to automate
6 Electronic Invoicing processing of invoices, allowing customers to settle accounts quickly and the
business get cash faster
A form of Digital Financing, Lease Financing is getting access to an asset for
6 Lease-financing
lease repayments without a large upfront cash outlay
A form of Digital Financing, Crowdfunding is raising money through small
contributions from a large number of people e.g. Kickstarter. It can also involve
6 Crowdfunding
crowd-sourced equity where shares are sold direct to investors on those
crowdfunding platforms
Digital investments support individuals or institutions to make investment
7 Digital Investments
decisions and arrange the investment transactions.
The use of platforms such as eToro to trade securities. These need fewer staff,
7 Online Brokerage
have lower costs, operate independently, and can process more orders
7 Mobile Trading Mobile trading is the trading of securities on your phone
Social trading is trading via internet platforms that allow you to copy other investor
7 Social Trading
strategies
Algorithmic Trading is high frequency without human intervention and using
7 Algorithmic trading
algorithms that can exploit market anomalies
Digital Money has no universally agreed definition but is agreed that it is in
electronic and not physical form. They can include traditional currencies or even
7 Digital Money cryptocurrencies (which are decentralised and hosted on a platform known as
blockchain that removes the need for a central intermediary to process the
transaction).
, Digital Payments are any payments initiated, processed, or received electronically
e.g. online banking, mobile payments, Peer-to-Peer payments between private
8 Digital Payments
individuals that immediately validate receipt of the payment (e.g. Paypal and
Google Pay), and Digital wallets (e.g. Google Wallet)
Mobile Payments use mobile technology to initiate and confirm payment, acting
8 Mobile Payments as a substitute for established payment structures e.g. Amazon, Apple, Facebook,
and Google
Peer-to-Peer payments between private individuals that immediately validate
8 Peer-to-Peer Payments receipt of the payment (e.g. Paypal and Google Pay). More complicated and
costly to recommend vs Open Loop Mobile Payments
Digital insurance platforms provide a range of value-adding services including
data analytics to allow clients to monetise and cross sell additional services.
9 Digital Insurance Alliances are formed and money is collected from them into a pool used to pay
small claims, saving administrative expenses for the insurance company.
Insurance company still deals with large pay-outs.
Digital Financial Advice is the use of review sites and comparison portals to
compare products and services and assess the reputation of financial service
9 Digital Financial Advice providers. It can also include Robo-advisors which generate investment
proposals/strategies given inputs provided (e.g. financial background, investment
goals, risk aversion, etc.)
Part of the Digital Finance Business Function dimension of the Digital Finance
10 Blockchain cube, Blockchain is a platform that provides an ordered, timestamped and secure
record of transactions, usually applied in cryptocurrency transactions.
Part of the Digital Finance Business Function dimension of the Digital Finance
cube, Social Networks are those that enable interaction and development of
10 Social Networks
networks via social media platforms e.g. focused platforms like LinkedIn and
general platforms like Facebook.
Part of the Digital Finance Business Function dimension of the Digital Finance
cube, NFC is a standardised Protocol that enables two devices to communicate
10 Near-Field Communication (NFC)
via radio frequency when brought close to each other (up to 4cm away).
Payments can be made using NFC.
Part of the Digital Finance Business Function dimension of the Digital Finance
10 Peer-to-Peer Technology cube, P2P technology is where resources and data are shared in a way that
avoids reliance on a central intermediary e.g. Blockchain is a P2P technology
Part of the Digital Finance Business Function dimension of the Digital Finance
10 Further Enablers
cube, Further (technological) Enablers that help facilitate financial processes,
, functions, and business models include fast internet connections, AI, intuitive user
interfaces, and automation technologies.
FinTech companies are usually start-ups or tech companies without history in
11 FinTech Companies financial services that have developed FinTech offerings that are more flexible,
efficient, and innovative than traditional service providers.
Traditional Service Providers include banks, insurance companies, and brokerage
companies, providing services on cash accounts, savings, and money
11 Traditional Service Providers
management. They need to innovate and defend their business against emerging
FinTechs.
Technology is where a company transforms information and data, human labour,
11 Technology
or economic capital into products or services of greater value.
11 Innovation Innovation is a change in the way technology is used.
Ten Types of Innovation Framework is a useful tool to improve potential or
developing innovation or analysing an existing approach. The Ten Types are
11 Ten Types of Innovation Framework categorised into Configuration, Offering, and Experience. These ten types include
Profit Model, Network, Structure, Process, Product Performance, Product System,
Service, Channel, Brand, and Customer Engagement
Lender-savers are those in a financial system whose income exceeds their
15 Lender-savers spending. This then indirectly or directly finances borrower-spenders. They can be
consumers, businesses, or government
Borrower-spenders are those in a financial system whose spending exceeds their
15 Borrower-Spenders
income. They can be consumers, businesses, or government
Direct financing is where funds move through financial markets e.g. large
15 Direct Financing
corporations selling securities/shares direct to lenders
Indirect financing is where institutions invest in financial assets and then collect
15 Indirect Financing money from lender-savers, aggregate the funds, and make loans in larger
amounts to other consumers, businesses, and government
Financial inclusion is the use of mobile smart phones that bring financial services
15 Financial Inclusion to people who previously did not have access or were not served by financial
institutions. More on page 27
FinTech 1.0 (2010-2014) began to pop up to use technology to target areas
underserved or overlooked by traditional banks. They focused on payment
16 FinTech 1.0
processing, generating new lending models using peer-to-peer structures, and
helping banks through personal financial management and risk modelling.
