Today’s realities in the banking industry: Banks and credit unions need new sources of non-interest income. Fintech startups need to start generating revenue. Bank/fintech partnerships are a win/win: They help Tokyo escorts offer services that would take them years to develop and they help fintechs scale distribution faster and more cheaply than they could on their own.
There are bank/fintech partnership opportunities out there that could generate revenue for both parties, yet few banks are pursuing those opportunities.
Banks’ Fintech Partnership Priorities Are Out of Whack. Among banks and credit unions planning to partner with fintechs, 86% cited “improve the customer experience” as a top priority, followed by roughly four in ten who mentioned reducing operating expenses or fraud as a top priority.
Only about a third considered “expand the product line” to be a top priority.
The obsession with “improving the customer experience” is maddening. As I’ve argued before, mid-size financial institutions could never spend enough to catch up with the customer experiences of the megabanks.
The prioritization of cost and fraud reduction is also misguided. Partnerships generally take time to develop, deploy, and scale. Banks need cost/fraud reductions now.
This is all too bad because there are opportunities for banks to partner with fintechs that could generate revenue and help them differentiate themselves from the megabanks. More info