Ernst and Young adoption index for 2017 highlights the impressive and rapid growth in adoption of fintech services among mature and developing markets with highest adoption rate among younger generations (25–34 years). On average, about 33% of digitally active consumers have used at least two fintech services in the last six months (compared to just 16% two years ago), with payments and money transfer being the most popular segments (used by 50% of digitally active consumers). Perhaps even more importantly, there is an increasing awareness: 84% of customers are aware of fintech services compared with 62%, two years ago. Thus, rising investments in fintech segment, as well as growing awareness and adoption of fintech services 1/4  BIS central bankers' speeches  indicates that fintechs are embraced and will continue to gain momentum in the future. Financial innovations change the environment not only for customers, but for traditional banking industry and policy makers, as well. Customers may benefit from increased and cost effective access to financial services, although in some instances at the cost of privacy and consumer protection. As for traditional financial institutions, such as banks, they may face strong competition by new entrants, on the one hand, but may benefit from increased cost efficiency, competiveness and ability to offer new state-of-the-art services, on the other hand. The impact on policymakers and regulators is also large, as they have to first properly understand innovations/new services, foresee possible consequences for financial intermediation and stability, and react in a timely and proper manner.
The most frequently mentioned motives of the banks that have formal partnership with fintech firms or develop their own solutions for usage of new technologies included attracting new or maintaining the existing customers as well as cost savings. Among the technological solutions which are already in use or are in testing phase, most of the banks cited cloud services, usage of biometric properties for client identification purposes and using of big data analysis for credit scoring. Currently, the banks do not have experience neither with algorithms used for the purpose of investment advice or decisions nor with any DLT based solutions. The regulators and policymakers also face challenges. Rules and regulations should keep pace with innovation, providing supportive environment but also adequately assessing and mitigating potential risks. Consequently, to apprehend the full benefits of digitalization, the authorities need to reach across traditional policy reluctances and across different levels of institutions, and develop a unified approach to policymaking. The Financial Stability Board stocktake of regulatory approaches to fintech finds that majority of jurisdictions surveyed have already taken or plan to take regulatory measures to respond to fintech. The scope and scale of changes or planned changes vary substantially, depending, among other things, on the relevant size and structure of domestic financial and fintech sectors and the flexibility already provided by the existing regulatory framework. An example of innovation in the legislative area has been set up by the European Union with the revised Payment Service Directive (PSD2).