Although we also saw a decline in technology costs that enabled banks of all sizes to offer a wider array of digital products and services to their customers, the innovation taking place outside the banking sector was often seen as outpacing the innovation in the banking sector. Consumers seemed to increasingly weigh convenience over safety, as a number of non-banks increased their market share.
Financial products that have become more varied, more sophisticated and more complex have a fatal side effect, namely that the inherent risks are more difficult to assess. Financial instruments are becoming separated from underlying transactions that should form their base and have developed into bubbles. Due to their internal dynamics, the bubbles are swelling and many have finally burst, which precipitated this crisis.