A Study on the Unbundling and Rebundling Strategy of FinTech Companies ─For Coping with the Era of IoT─

Abstract

Japanese mobile phone manufacturers are said to have declined and collapsed. The possible cause is that the industrial structure has changed to an international horizontal division of labor. The reason for the horizontal division of labor of the industrial structure is that technology has become modular. The modularization of technology has made it possible for the division of labor in various functions along the value chain. Then, vertical integration was destroyed as keystone companies of the ecosystem proceeded with unbundling functions that made it possible to divide labor. The current trend of FinTech in the financial industry encourages the horizontal division of labor in the financial services industry. If Japan’s financial industry does not change its industrial structure to a horizontal division of labor, it could decline like he Japanese digital home appliance manufacturers. This paper aims to reveal strategies for FinTech companies to transform the structure of the financial industry. FinTech’s strategy is to unbundle high-value functions and be selected about customers. Moreover, rebundling existing financial institutions by increasing customer value through differentiated services is the strategy to expand the ecosystem. This paper will explain these strategies from the case of the SBI Group, which represents FinTech in Japan.