The banking and payments industry continues to be a hotbed of innovation owing to ever changing consumer expectations. The rapid technological developments in the areas of banking and payments that aim to offer seamless experience to consumers are now becoming even more vital for industry participants as competitors leverage new technologies such as artificial intelligence, Internet of Things, cybersecurity, and embedded finance as they compete to stay relevant and grow in the market.. In the last three years alone, there have been over 92,000 patents filed and granted in the banking industry, according to GlobalData’s report on Innovation in Banking: digital lending.
However, not all innovations are equal and nor do they follow a constant upward trend. Instead, their evolution takes the form of an S-shaped curve that reflects their typical lifecycle from early emergence to accelerating adoption, before finally stabilising and reaching maturity.
Identifying where a particular innovation is on this journey, especially those that are in the emerging and accelerating stages, is essential for understanding their current level of adoption and the likely future trajectory and impact they will have.
60+ innovations will shape the banking industry
According to GlobalData’s Technology Foresights, which plots the S-curve for the banking industry using innovation intensity models built on over 195,000 patents, there are 60+ innovation areas that will shape the future of the industry.
Within the emerging innovation stage, transaction-enabling smart contracts is a disruptive technology that is in the early stage of application and should be tracked closely. Distributed ledger network, BNPL payment protocols, and virtual banking assistant are some of the accelerating innovation areas, where adoption has been steadily increasing. Among maturing innovation areas are IM trading platforms and in-app payments, which are now well established in the industry.
Innovation S-curve for the banking industry
Digital lending is a key innovation area in banking
Digital lending is an automated lending process used by financial institutions to provide and recover loans through web platforms or mobile apps. Digital lending is aimed to simplify and speed up lending decisions and involves customer acquisition, loan disbursement, recovery, and associated customer service.
GlobalData’s analysis also uncovers the companies at the forefront of each innovation area and assesses the potential reach and impact of their patenting activity across different applications and geographies. According to GlobalData, there are 50 companies, spanning technology vendors, established banking companies, and up-and-coming start-ups engaged in the development and application of digital lending.
Key players in digital lending – a disruptive innovation in the banking industry
‘Application diversity’ measures the number of different applications identified for each relevant patent and broadly splits companies into either ‘niche’ or ‘diversified’ innovators.
‘Geographic reach’ refers to the number of different countries each relevant patent is registered in and reflects the breadth of geographic application intended, ranging from ‘global’ to ‘local’.
Patent volumes related to digital lending
|Company||Total patents (2010 - 2021)||Premium intelligence on the world's largest companies|
|Alibaba Group Holding||223||Unlock company profile|
|Mastercard||193||Unlock company profile|
|State Farm Mutual Automobile Insurance||140||Unlock company profile|
|Ping An Insurance (Group) Company of China||124||Unlock company profile|
|Visa||107||Unlock company profile|
|INRIX||73||Unlock company profile|
|Toronto-Dominion Bank||60||Unlock company profile|
|Allstate||55||Unlock company profile|
|Swiss Re Asia Pacific||46||Unlock company profile|
|Capital One Financial||35||Unlock company profile|
|PayPal Holdings||30||Unlock company profile|
|E2Interactive||28||Unlock company profile|
|Toshiba||26||Unlock company profile|
|Taikang Insurance Group||26||Unlock company profile|
|Bank of America||24||Unlock company profile|
|American Express||20||Unlock company profile|
|USAA||20||Unlock company profile|
|Swiss Reinsurance||20||Unlock company profile|
|International Business Machines||19||Unlock company profile|
|Tencent Holdings||19||Unlock company profile|
|SoftBank Group||18||Unlock company profile|
|JPMorgan Chase||18||Unlock company profile|
|10353744 Canada||18||Unlock company profile|
|Hartford Financial Services Group||18||Unlock company profile|
|Blackhawk Network Holdings||17||Unlock company profile|
|CME Group||17||Unlock company profile|
|Upaid Systems||17||Unlock company profile|
|Block||15||Unlock company profile|
|Fiserv||15||Unlock company profile|
|Toyota Motor||13||Unlock company profile|
|eBay||13||Unlock company profile|
|Synchrony Financial||12||Unlock company profile|
|Nokia||12||Unlock company profile|
|Walmart||12||Unlock company profile|
|Fidelity National Information Services||11||Unlock company profile|
|NCR||11||Unlock company profile|
|Hitachi||11||Unlock company profile|
|Furukawa||11||Unlock company profile|
|Wells Fargo||10||Unlock company profile|
|General Electric||10||Unlock company profile|
|China Construction Bank||9||Unlock company profile|
|Equifax||9||Unlock company profile|
|Microsoft||9||Unlock company profile|
|Alegeus Technologies||9||Unlock company profile|
|LyondellBasell Industries||9||Unlock company profile|
|Experian||9||Unlock company profile|
|Warrantee||9||Unlock company profile|
|Huawei Investment & Holding||9||Unlock company profile|
|Huntington Bancshares||8||Unlock company profile|
|Healthy io||8||Unlock company profile|
Source: GlobalData Patent Analytics
Healthy io, INRIX, Upaid Systems and State Farm Mutual Automobile Insurance are some of the leading patent filers in the digital lending industry. Several patents have been filed in the digital lending space, which include systems for evaluation and approval of mortgage applications and technologies for borrower and asset verification.
In terms of application diversity, Healthy io leads the pack, while INRIX and Upaid Systems stood in the second and third positions, respectively. By means of geographic reach, INRIX holds the top position, followed by E2Interactive and Warrantee.
To further understand the key themes and technologies disrupting the banking industry, access GlobalData’s latest thematic research report on Banking.