Three reasons banks and fintechs should collaborate more

Last updated: 31 October 2019

Banks and fintechs – collaborate, collaborate, collaborate. That’s the message from Copenhagen’s Money 2020, which brought together over 4,000 key players in payments and financial services to discuss the future of the sector. Keynote speakers included the CEOs of Commerzbank, ING Group and Visa Europe, as well as senior decision-makers from Amazon and Google, so lucky attendees enjoyed insights into issues affecting different stakeholders.

As you’ll know from reading our blog, the industry has seen rapid innovation over the last few years, due to the rise of contactless technology, new methods of authentication and evolving cybersecurity solutions. What we learned in Copenhagen was that more collaboration between banks and fintechs is necessary to properly harness the exciting technological innovation we’re seeing. Here are three reasons why:

Trust, speed, convenience

Of course, security solutions need to be robust. When making a purchase, a customer needs to know their credentials and funds are being protected. If that trust isn’t there, the consumer is inevitably going to be reluctant to embrace new technologies and feel dissatisfied with their service providers.

However, there’s a big ‘but’. It’s all very well developing a security solution which nullifies the threat, but if that makes the transaction too complex and time-consuming for the customer, then it’s going to dissuade them from using the service. It’s essential, then, that the speed of the transaction is preserved by any security solution.

By sharing expertise, assets and knowledge of their customers, banks and fintechs can ensure that consumer convenience is placed at the heart of security solutions, preserving the seamless experience of an online or contactless transaction.

Enhance innovation through sharing assets

Both banks and fintechs bring unique strengths to the table. Banks, of course, possess market share and boast well-established relationships with their customers, often developed over many years. Fintechs, meanwhile, offer specialist technical knowledge, enabling them to speed up procedures and build agile digital solutions.

By collaborating more and competing less, banks and fintechs can reap the rewards by leveraging their assets. And if there any fintech leaders out there doubting the desire of banks to innovate, then let us put your mind at rest. Banks are fully aware that a failure to innovate could cost them per-customer revenue; and if the speeches at Money 2020 are anything to go by, banks see technological development as crucial.

Make it personal

Customers need to feel like when they make a transaction, they’re embarking on a seamless journey that they understand and trust. Consumers should be empowered to create their own virtual digital identity, which they can use to make safe payments and engage with other services.

Personalization is going to be crucial, and that dream can only be realized through a combination of bank assets and sophisticated tech tools. Personalization can also be a source of inspiration for great ideas; for example, Mark Mullen CEO and co-founder of Atom Bank announced at Money 2020 how Atom Bank’s UX was inspired by the water alien from the 80s movie, The Abyss. The water alien in the film is well-known for adapting to any person it interacts with.


We know that robust security solutions preserving a seamless customer experience are possible. Dynamic Code verification replaces the security code on the back of a card with a serial number that evolves every twenty minutes. This innovation makes life difficult for CNP fraudsters, but allows customers to complete transactions easily by simply typing in the code they see on their card at the time of purchase.

To fully benefit from technically-advanced solutions like DCV, and develop customer-centric payment strategies of their own, there’s a clear need for banks to embrace advanced solutions through collaboration. Money 2020 showed that leaders from both sectors are realizing the benefits of building relationships and making progress.

What do you think about the relationship between banks and fintechs? What could be done to foster more purposeful interaction between them? Let us know your thoughts – as well as your key learnings from Money 2020 – by posting a comment below or tweeting to us at @Gemalto.

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