Fintech companies are set to win significant market share from banks says JPMorgan's Chase chief Jamie Dimon, who laments the regulatory constraints that hobble banks as they face up to the threat from Big Tech competitors.
In his annual letter to shareholders, Dimon says that it is "completely clear" that many banking products such as payments, deposits and loans are moving out of the banking system to neobanks and non-banks alike. Dimon acknowledges that many of these new competitors have done a "terrific job" in easing customers’ pain points and making digital platforms slick and simple to use. However, they have also benefited from differences in the regulatory playing field "We should remember that the quantum of risk may not have changed - it just got moved to a less-regulated environment," states Dimon. "And new risks get created. While it is not clear that the rise in nonbanks and shadow banking has reached the point of systemic risk, this trend is accelerating and needs to be assiduously monitored."