For some time now the financial technology (“FinTech”) industry has been attracting more and more attention and the spotlight has shone light on how innovation is transforming the financial sector in ways never thought before. What’s more, it has become apparent that these are no longer small innovations that a big bank can easily acquire and be done with it, rather thousands of startups that are eager to bring simplicity, sophistication and real-time benefits to everyday consumers that are tired of the way things are handled by everyday banks.

It’s death by a thousand cuts.

According to CB Insights, hundreds of startups from all over the world are attacking bank’s product & service lines.

The four categories where startups are tackling banking functions and making them easier, faster and on-demand are the following:

1. Payments

Sending and receiving payments before Square and Braintree was very painful and limited. Credit Card companies would sometimes charge astronomical fees and in order to take a variety of cards (Master Card, Visa, American Express, etc) your bank needed to support them or you’d had to find another one that did. Fast-forwarding to today, according to Scott Walchek “new companies are making the process simpler and are making it easy for businesses and individuals to send and accept payments on-the-go — via credit and debit cards, as well as bank transfers — with significantly lower fees and less red tape”

Making it easy to transfer funds to friends and families is another area of payments that companies of the size of Venmo, Google Wallet and Snapcash are disrupting. They becoming very popular among consumers to pay collaboratively for goods and services.

Finally, on the business side, small businesses had long had the problem of not being able to afford a wholesome accounting time that can ensure their employees and freelancers are getting paid on time, and that their benefits are being managed. ZenPayroll or Wave are examples of companies that provide affordable services to do just that.

1. Lending

Loans are a topic that makes a lot of people cringe. It has historically been a time consuming, tedious and expensive experience. Before, if you didn’t have a good credit standing, your chances of getting a loan approved were slim at best.

There are a couple of plays being made in this sector. One with the approval policies and practices surrounding loans, and the other with the availability of funds, rates and cash advances in the economy. It’s important to note that they are arriving to a final decision within days and not weeks or months as banks usually do. Lending Club is the biggest name having arranged close to $9 billion in loans through its marketplace.

1. Personal Finance Management

For too long this has been associated with the use of an Excel spreadsheet to stay on top of your expenses and investments. A tedious task that involved a high degree of data entry and manual labor. Now companies like BillGuard are helping consumers better understand their expenditures and are receiving a variety of metrics that are helping them better manage their finances.

What’s more, the rise of services available for wealth management such as Acorns, Betterment and Robinhood, have made possible for the average Joe to invest their money where they want with free stock trades, portfolio management tools and automated investment based on preset goals. This lifts the restriction that some financial institutions have on wealth management accounts, where a certain amount of funds is necessary to open one.

1. Bitcoin

Bitcoin is an innovative payment network and a new kind of money that is revolutionizing the market. Many startups have emerged around this idea and making it more and more available to the overall public.

The need for companies that tackle the above categories has been reinforced by the fact that investment in the FinTech industry has quadrupled since 2010 and that corporations of the size of Google, Intel and Citi are starting to turn to this sector as the next big thing.

Aaand There’s more.

The 80 million millennials that will control 46% of the American economy by 2025 are no longer relying heavily on financial institutions as the Baby Boomers once did. They do not feel identified with the particular financial institution they use, and according to First Data a third of them are willing to change financial institutions within the next three months and 27% percentage are willing to consider using a branchless bank. What’s more 68% of millennials believe that in five years the way we access our money will be completely different.

This shows the psychological shift that financial innovation brought. With so many options to engage in banking-related transactions straight from the palm of your hand and in real-time, it has become somewhat irrelevant to step inside a bank branch.

Stepping back and analyzing all of this information and putting the parts together, a single recurring question pops into mind; Do we really need a bank nowadays?

In my eyes, this is a tricky question that deserves careful analysis, but it seems that some millennials think differently than I do. According to the Millennial Disruption Index, 33% of millennials don’t believe we need a bank at all.

This is astonishing and should raise all kinds of red flags at financial institutions, as 26 million of their potential future customers just banished.

Why do they say they don’t need it? Why do we need it in the first place? Do they have something someone else can’t offer? These questions are those that should be answered in order to arrive to a final decision. Now let’s address them.

With all of these startup companies tackling banking features like bill paying, lending, personal financial management, and even currency, it is hard to answer these questions with a holistic approach. It seems that the only benefit of being member of a bank branch is the ability to store currency or funds securely (FDIC insured and fraud protected) into an account that can be accessed anywhere in the world. Furthermore, an argument could be made that many of the functions offered by banks lack transparency, simplicity and take too long. Take for example its bill paying function, banks do exactly what they say they will; house all of your bills under one roof where you can pay them, but what it doesn’t do is provide solutions to really solve the problems revolving bill paying. Those are, the transparency factor or knowing how much you spend on a monthly basis, the fact that 85% of Americans overpay for some bill every month, and most importantly that some people are not able to pay the totality of their bills because of cash flow difficulties.

In my eyes, banks made the wrong bet. They sided with quantity over quality.

Now, lets imagine for a moment that an interconnected network of financial applications exists and you can access your funds 24/7 from every part of the world and through which you can pay your groceries and bills, get a loan or invest and manage your expenses. All of this protected and insured.

Would banks become irrelevant then?

I think they would.

What do you think?