Fintech is no longer a sector
It is now a capability built into banks, retailers and platforms alike — and the question every executive should be asking has changed.
Fintech is no longer a separate sector competing with banks. It is a capability — one that now shows up inside banks, insurers, asset managers, retailers, platforms and companies that have nothing to do with finance at all. For a decade, “fintech” meant something narrower: a wave of venture-backed challengers building banking, payments and lending products from outside the walls of traditional finance. That category still exists — the logos, the app stores, the funding rounds. But it no longer describes what is actually happening in financial services, and the distinction matters. A sector has boundaries — you can watch it from across the table, plot it on a market map with your name in the middle and the challengers arranged around the edge. A capability has none of that discipline. It turns up inside your own organisation, your suppliers and your customers' expectations, whether or not anyone approved it getting there.
On this page
The old view: a sector built to compete with banks
The framing most executives still carry dates to the 2010s. Neobanks launched app-only accounts and made a virtue of not being a bank. Payments start-ups undercut the card networks on price and speed. Lending platforms promised faster decisions than a mortgage desk buried in paper. Venture capital treated the category as its own asset class, complete with its own conferences, its own league tables and a line on the org chart marked “innovation.” Incumbents responded in kind, building innovation labs and venture arms to monitor, pilot or occasionally acquire the threat from a safe distance.
Underneath it all sat one assumption: that fintech and financial services were two different industries, competing for the same customer. That assumption is now out of date, and the market's own numbers show why.
The reframe: a capability, not a category
Boston Consulting Group's 2024 global fintech report projects that embedded finance — financial products sold by non-financial companies as part of something else they already sell — will generate roughly $320 billion in global revenue by 2030, split between small and medium-sized businesses (around $150 billion), consumers (around $120 billion) and enterprises (around $50 billion). That is not a forecast about fintech companies selling more banking apps. It is a forecast about financial capability turning up inside businesses that were never financial companies to begin with.
Cloud computing followed a similar arc. It started as a specialist infrastructure category with its own vendors and its own budget line; within a decade, every function from finance to marketing was quietly built on it, and the question stopped being whether to use cloud and became which parts of the business still weren't. Fintech is moving the same way, faster, because payments rails, know-your-customer checks, credit decisioning and ledger infrastructure are now available as licensable components rather than things a company has to invent. Once a capability can be bought in modules, it stops belonging to the industry that invented it. It moves to wherever the customer relationship already sits.
Inside banks: the capability already runs the plumbing
The clearest evidence sits inside the institutions supposedly under threat. The UK's Financial Conduct Authority reported in December 2025 that more than 16 million people and businesses now use open banking — meaning they've connected a bank account to a third-party app or service, to make a payment directly from their account, check affordability, or share transaction data for a loan decision — with payment volumes up 53% year on year. That is not a pilot or an innovation-lab feature. It is default infrastructure, running quietly underneath ordinary banking activity, built on standards that did not exist a decade ago.
Regulators are extending the same logic, not retreating from it. The European Parliament and the Council of the EU reached provisional political agreement on the new Payment Services Directive (PSD3) and Payment Services Regulation on 27 November 2025, with the texts due in the Official Journal during the first half of 2026 and entry into force following in 2027. Among the requirements: account-servicing institutions across the EU must implement dedicated, high-performing data-access interfaces (purpose-built connections — commonly APIs — that let authorised third parties pull account data directly and reliably, held to minimum speed and uptime standards), replacing the looser fallback arrangements PSD2 allowed (where a bank could skip building a dedicated interface and instead let third parties access accounts through its ordinary online banking screens, provided that channel met basic performance conditions). Ten years after the original open banking rules, European regulators are hard-wiring the capability further into how every account-holding institution is required to operate.
Beyond banks: retailers are becoming financial institutions in their own right
The more striking evidence sits outside financial services altogether. Walmart, the largest retailer in the United States, is majority owner of OnePay, a fintech company it helped found in 2021 with the venture firm Ribbit Capital, rebranded under its current name in March 2025.
OnePay is explicit that it is not itself a bank. The FDIC-insured accounts behind its app sit at two partner banks, Coastal Community Bank and Lead Bank, and its credit card is issued by Synchrony on the Mastercard network — a partnership announced in June 2025 that replaced Capital One, Walmart's previous card issuer. What changed is not that banks disappeared from the picture. It is who the customer thinks of as their financial provider, and who controls the product, the app and the data. Walmart and Ribbit built the platform; the chartered banks became interchangeable infrastructure behind it.
OnePay now offers banking, co-branded credit cards, personal loans, buy-now-pay-later financing through a partnership with Klarna, and cryptocurrency trading, with investment services expected to follow — all sitting inside Walmart's own retail footprint, at checkout and online, available to shoppers who never set out to open an account with anyone.
None of this makes retailer-owned finance new. European supermarkets have run their own banks for decades — Tesco Bank traces to 1997, Sainsbury's Bank to 1996, Migros Bank in Switzerland to 1958. What has changed is the model, not the ambition. Tesco sold its banking book to Barclays in November 2024; Sainsbury's surrendered its own banking licence on 1st July 2026 and relaunched as Sainsbury's Money, a brand that distributes partner products rather than holding deposits itself. Both retreats point the same way: owning a full bank charter proved capital-intensive and distracting from retail. Carrefour Banque never took that route to begin with — it has operated as a joint venture with a bank, BNP Paribas Personal Finance, since the 1980s. Seen against that history, OnePay's structure looks less like something new and more like where the model was always heading. Migros Bank is the exception: cooperative-owned, with no outside shareholders demanding capital efficiency, it has faced none of the pressure that pushed Tesco and Sainsbury's out.
Walmart is not a fintech company. It is a retailer that now runs one. And the logic cuts both ways: if a retailer can absorb a banking capability this completely, a bank can absorb a retail, insurance or advisory capability just as completely, if it decides to compete on the same terms.
Why the capability keeps moving, even as funding tightens
Sceptics will point to the venture-funding slowdown as evidence the fintech wave has crested. The data says something more specific. Global fintech start-ups raised $28.6 billion in the first half of 2026, up 22.7% year on year — but the number of deals fell 25.7% over the same period, to 1,605, the lowest first-half count in several years. Investors are not funding fewer ideas because the opportunity shrank. They are writing fewer, larger cheques into companies that already have scale, distribution and regulatory infrastructure in place — exactly the kind of capability provider a bank, retailer or platform would buy or partner with, rather than build from a standing start.
That points to something incumbents cannot easily fix with more budget. McKinsey estimates that banks' technology spending reached 10.6% of revenue and 20% of total expenses in 2022, with technical debt consuming a further 10–20% on top of new project budgets. Most incumbents are not short of technology spend. They are short of technology spend that is actually free to build something new, rather than servicing what already exists — which is exactly why the capability increasingly arrives through investment, acquisition or partnership rather than being built from scratch in-house.
The real question: not “is fintech a threat” but “who controls the capability”
Put the evidence together and the old question — is fintech a threat to our business — stops being useful. The capability is not outside the business, deciding whether to attack it. It is already inside most businesses in some form, whether an executive team put it there deliberately or not, through a payments vendor, an embedded lending partner, or a customer app that quietly does more than anyone remembers signing off. The question that actually determines who wins is narrower: who, inside your organisation, controls that capability, decides how it develops, and is accountable for what it does next?
I have sat on both sides of that question. Inside a bank's core-banking transformation, I watched a due-diligence process argue for months over whether to build a capability in-house, while a competitor's fintech venture team shipped a comparable product in weeks. The engineers on both sides were equally good. What differed was who was accountable for the decision, and how quickly that person was allowed to make it. That is the real dividing line now — not fintech versus incumbent, but who inside an organisation has actually been given the authority to decide.
There is a further shift coming into view. Financial capability is becoming not just embedded, but increasingly autonomous. AI systems can initiate actions, make decisions and interact with financial infrastructure on behalf of customers and organisations. That makes the question of ownership more urgent: who is accountable when the capability no longer waits for a human decision?
Aulay's view
This is a decision problem before it is a technology problem. Every organisation facing it is really choosing between four options — build, buy, partner, or kill the initiative and focus elsewhere — and the organisations that get this right are not the ones with the biggest technology budget. They are the ones with the clearest owner, the fastest decision cycle, and the discipline to say no to initiatives that will not clear the bar.
That applies in both directions. A bank might need to admit, for the third year running, that a capability is better bought than built. A retailer or platform might need to admit the reverse: that the capability has become central enough to the customer relationship that it can no longer sit with a third party. Either way, it is a decision that should be made on purpose, not one that arrives by default because nobody revisited it. If your organisation is working out where financial capability should sit — build it, acquire it, partner for it, or stop investing in it — that is worth a conversation before the next budget cycle locks the answer in for another year. The harder question is becoming who owns the outcome when that capability starts making decisions for you. Get in touch to talk through where the capability should sit — and who should own it — in yours.
REFERENCES
1. Boston Consulting Group, “Global Fintech: Prudence, Profits, and Growth,” 26 June 2024, section “Four Major Themes Shaping the Fintech Sector.”
https://www.bcg.com/publications/2024/global-fintech-prudence-profits-and-growth
2. Financial Conduct Authority, “Open banking: a year of progress,” news story, 16 December 2025.
https://www.fca.org.uk/news/news-stories/open-banking-2025-progress
3. DLA Piper, “PSD3 and PSR: Proposed reforms to the EU Payments Framework,” 9 March 2026.
https://www.dlapiper.com/en/insights/publications/2026/03/psd3-and-psr
4. Modern Retail, “Walmart deepens relationship with OnePay, a one-stop finance app it helped create,” 20 October 2025.
5. Crunchbase News, “Fintech Funding Surges 23% In H1 2026 As Investors Concentrate Their Bets On AI And Financial Infrastructure,” 15 July 2026.
https://news.crunchbase.com/fintech/funding-rises-deals-slump-h1-2026/
6. McKinsey & Company, “Managing bank IT spending: Five questions for tech leaders,” 18 October 2024, section “The rapid rise in global banking IT spending.”
7. OnePay, “About OnePay banking,” Help Center article.
https://www.onepay.com/help-center/articles/about-onepay-banking
8. Synchrony, “OnePay and Synchrony to Launch New Industry-Leading Credit Card Program with Walmart,” investor press release, 9 June 2025.
9. Barclays, “Completion of the acquisition of Tesco's retail banking business,” press release, 1 November 2024.
10. Sainsbury's, “Launch of Sainsbury's Money as Sainsbury's Bank transformation completes,” press release, 1 July 2026.
11. Migros Group, 2025 Annual Report, “Financial services” section.
https://report.migros.ch/2025/en/financial-services
12. MoneyVox, “Carrefour Banque,” company profile.
Frequently asked questions
- Is fintech still a separate industry from banking?
- Not in practice. The functions that made up “fintech” — payments, lending, KYC checks, ledger infrastructure — are now licensable components embedded inside banks, retailers and platforms, rather than a category of standalone challengers competing against incumbents.
- What is embedded finance?
- Financial products such as payments, lending or insurance sold by non-financial companies as part of something else they already sell. Boston Consulting Group projects it will generate around $320 billion in global revenue by 2030.
- Did Walmart build its own bank?
- No. Walmart is majority owner of OnePay, a fintech company offering banking, credit cards, loans, buy-now-pay-later financing and crypto trading — but OnePay itself says plainly that it is not a bank. The underlying accounts sit at partner banks Coastal Community Bank and Lead Bank, and Synchrony issues the OnePay credit card on the Mastercard network. What Walmart built is the platform and the customer relationship; the banking licence still belongs to a bank.
- Haven't retailers already run their own banks for decades?
- Yes, and that's a different question from retail banking (the consumer-banking segment, which is centuries old). Tesco Bank (1997) and Sainsbury's Bank (1996) are the clearest examples of retailers running banks, and both have recently exited full-scale banking, selling their operations to Barclays and NatWest respectively. What has changed is the operating model: retailers are moving away from owning a full bank charter and toward a platform built on top of bank or embedded-finance partners — the way Carrefour Banque has operated since the 1980s, and the way OnePay operates today.
- What should executives do about it?
- Treat it as a decision, not a threat assessment. Name a single owner for each fintech capability the organisation already touches, and run it through build, buy, partner or kill — deliberately, rather than by default.
- What does AI change about embedded financial capability?
- It makes the ownership question more urgent. As AI systems become able to initiate actions and interact with financial infrastructure, organisations need to decide not only who provides a capability, but who governs and remains accountable for what it does.