Latest News  

TELUS International Europe: How big banks and fintechs are working together to innovate the customer experience

Comparing financial technology (fintech) companies to legacy financial institutions can invoke an image of David and Goliath. Fintech firms may be small, particularly when compared to the established titans of banking and financial industries, but they're certainly fierce

2017-09-18 23:08:06





Grégoire Vigroux
Vice-President Marketing of TELUS International Europe


With the use of emerging, often mobile, technology and smart design to provide customized experiences and slick user interfaces, the adoption of fintech has been impressively swift. EY estimates that 15.5 percent of digitally active consumers have used at least two fintech products within the last six months – with rates anticipated to double in the next year.

The meteoric rise of fintech companies has not gone unnoticed by their big bank counterparts. Jamie Dimon, JPMorgan Chase CEO, wrote in his annual letter to shareholders: "It is unquestionable that fintech will force financial institutions to move more quickly, and banks, regulators and government policy will need to keep pace."

But rather than duking it out to the bitter end, fintechs and legacy financial institutions are discovering that they are better friends than foes, combining their strengths to offer an exceptional and innovative customer experience in the process.

Working together to fill in the gaps


Traditional financial intuitions have had decades, if not centuries, to establish their brands and build rapport with consumers. But their reliance on old systems and procedures have stifled their appeal to a tech-savvy customer base. Yet, there's no way to avoid it.

From simple banking, to mortgages, loans, investments and debt consolidation, the modern banking experience is becoming more digitized, and fintechs have played a significant role in that evolution. Not tied down by traditional thinking or extensive regulation, fintechs are providing new and fresh perspectives to addressing customer needs and opportunities.

Intuitive user interfaces, personalized solutions and real-time recommendations based on interactive data are just a few of the unique characteristics fintechs are utilizing to redefine the customer experience. However, what they offer in innovation, they often lack in experience, capital and consumer trust, particularly as it relates to security. Blumberg Capital's 2016 fintech survey found 72 percent of Americans listed security as something to be concerned about with new online banking services, and that they are not confident that their information is private.

By partnering, more traditional institutions and fintechs are able to bring unique value to the table and ultimately offer customers an innovative, full-service banking, investing or payment experience.

Three partnership models


JPMorgan Chase has now partnered with more than 100 fintech companies, and it's not alone. All major banks, including Bank of America, Citigroup, Goldman Sachs, Morgan Stanley and Wells Fargo, have invested in fintech start-ups. These partnerships are a delicate balance of give-and-take with three key models emerging:

1. Outsource


Banks are no stranger to the outsourcing model, having long utilized external partners to perform various customer care, IT and back office functions. Outsourcing has helped financial organizations improve efficiency, lower costs and even generate top-line growth.

With a proven track record, an outsourced model can enable traditional firms to meet more demanding customer expectations. For instance, JPMorgan Chase is using fintech firm On Deck Capital to help offer quicker approvals and same-or-next-day funding to some of its four million small-business customers. Many banks have also employed IT Outsourcing in a similar fashion, to gain creative technology solutions that may be too expensive or specialized to develop in-house.

2. Invest


Many large financial institutions are eager to invest in fintech start-ups in an effort to manage disruption. Goldman Sachs, Citi Ventures, JPMorgan Chase and Morgan Stanley have put money into Square, a mobile payments company, to ensure access to its innovative technology. Meanwhile, JPMorgan Chase and Goldman Sachs have bet on online brokerage Motif Investing, and Morgan Stanley, Bank of America and Citibank have all invested in Visible Alpha, a start-up offering a platform to interpret and forecast stock data.

The benefits to both parties for this option are extensive. It's a relatively easy, low-risk way for banks to access innovative products and services that can strengthen their customer relationships and get a leg-up on the competition. For their part, the start-up secures a huge distribution network and regulatory compliance.

3. Nurture


To nurture new ideas in the marketplace, many banks are plugging into the start-up community without buying any direct equity. They start their own incubators, accelerators or innovation labs to get early access to new technologies and ideas from thought leaders in the industry. Wells Fargo, for instance, has pumped funds into boot camps to support a start-up developing automated real estate transaction technology, and another early-stage company exploring voice technologies.

Some banks also sponsor hackathons to discover new ideas, technologies and the best potential partners for mutually beneficial collaboration. Hackathons and other rewards-based competitions can get a bank's brand some recognition in the start-up community, while exposing the bank's staff to new ideas and technologies. The downside, however, is that there is often no exclusivity in most of these partnerships.

The road ahead


With pros and cons to each, most banks and fintech companies are experimenting with multiple partnership models to cover their innovation bases. While each partner reaps some benefit in the symbiotic relationship, the real winners are consumers. The evolving partnerships between fintechs and big banks ensure inventive banking solutions, built on a foundation of trust, and focused on the changing needs of today's savvy customer.

Keep up-to-date with the latest thinking about BPO, ITO and Contact Center solutions. Each month, TELUS International, a global provider of contact center outsourcing and BPO solutions, shares insights on the latest customer service trends.

Related articles: www.telusinternational-europe.com /
www.telusinternational.com


0 COMMENTS ^ Go back to Top
WRITE A COMMENT ^ Go back to Top
 
Your email address will not be published.
Nickname
Email
Comment
Validation Code
   
 
 
NEWS
Cushman & Wakefield Echinox: StreamWIDE joins the new IT hub created in the Timpuri Noi Square project

StreamWIDE, a company specialized in the software and telecommunications industry, realocates its office in Bucharest in the Timpuri Noi Square project, joining the new IT hub created in the business park devel

 Read Full article »
CBRE: Office deliveries expected to bring new stock of 635.00 sqm, Bucharest to reach 3.9 mln sqm modern office spaces

During 2020–2021 to approx. 635,000 sqm of modern office space are expected to be delivered on market, increasing the Bucharest modern stock at approx. 3.9 million sq m, a step closer to a new a threshold and

 Read Full article »
Uber opens at Bucharest the largest support center to drivers and business partners in CEE

Uber company launched this week in Bucharest the largest center in Central and Eastern Europe that offers assistance to drivers and business partners in Romania, a center where they can contact directly Uber re

 Read Full article »
Samsung and Orange Romania activated the 5G VR Live streaming at Untold Music Festival in Romania

Samsung Electronics and Orange Romania have successfully deployed a 5G New Radio (NR) network to demonstrate a series of 5G use cases at Untold Festival 2019, the largest annual dance music festival in Romania,

 Read Full article »
MVP Lab in Sibiu named as one of Europe's best in the "Ones to Watch" list at European Business Awards

Ropardo MVP Lab has been named as ‘One to Watch' in Europe in a list of business excellence published by the European Business Awards, one of world's largest and longest running business competitions.

 Read Full article »
Endava marks one year since IPO

Endava, one of the most important software companies, present on the local market with 7 delivery centers, reaches an almost double capitalization, 2.07 billion USD, on July 26, 2019, one year after listing. Th

 Read Full article »
Infosys opens cyber defence centre in Bucharest

Infosys, a global leader in next-generation digital services and consulting, announced the launch of its Cyber Defence Centre in Bucharest, Romania. The Defence Centre is an expansion of services delivered thro

 Read Full article »
QuEST Global completes integration of IT Six Global Services

QuEST Global, a global product engineering and lifecycle services company, has successfully completed the integration of IT Six Global Services SRL. QuEST Global acquired IT Six, a software engineering services

 Read Full article »
RE MAX Romania opens three more offices

RE/MAX Romania has expanded its network, adding three new offices – RE/MAX Partners in Cluj, RE/MAX Quality in Sibiu and RE/MAX Prestige in Targu Mures.

 Read Full article »
Microsoft and OpenAI form exclusive computing partnership to build new Azure AI supercomputing technologies

Microsoft Corp. and OpenAI have partnered to further extend Microsoft Azure's capabilities in large-scale AI systems, according to a release of Microsoft.

 Read Full article »
 
 
 
MOST READ ARTICLES
» Shifting the workplace perspective tow...
» SMEs, micro-enterprises can access fun...
» Opinion: Why Canada, Asia and Australi...
» TELUS International continues partners...
» Olivier Hecq, Head of SSC IT, SGEBS:" ...
» ABSL presents the 3rd edition of Iasi ...
» More than 500 business leaders at the ...
» IT and BPS to ensure most of the Roman...
» Connections signs partnership with UiP...
» Business in the service of a higher pu...
 
EDITOR CHOICE
Workplace of the Future conference to take place on November 20th at Bucharest

The Diplomat-Bucharest together with Outsourcing Today organize the 3rd Edition of WORKPLACE OF THE FUTURE, on 20th of November 2019, in Bucharest, at Capital Plaza Hotel.

 Read Full article »
Strategic Talent Acquisition at People Empowering Business Forum on October 30 in Bucharest

Latest trends like demographic upheaval, globalization, digital technology, and changing social values and worker expectations, are disrupting business models and radically changing the workplace. These are req

 Read Full article »
Informal IT School and UiPath launch an educational program for RPA development to start in October

Informal IT School announced a partnership with UiPath to launch an RPA development educational program of five months, 100 hours of courses, five days a week. The program will run in Cluj-Napoca.

 Read Full article »
Impact Hub Bucharest joins 3house to manage three coworking spaces in the city

Impact Hub Bucharest, a coworking spaces manager and developer of accelerator programs and events merged with 3house, a new concept of workplace launched in 2018. By this, Impact Hub reaches 3 locations and 6.7

 Read Full article »
JLL: Total office space in Bucharest to reach 3 million sqm

The second quarter of 2019 reconfirmed the increased interest for the office market in Romania. Over 115,000 square meters of office space were leased over this period at the national level, a value similar wit

 Read Full article »
Latest News  
 
about us | newsletter | contact | members area | GDPR policy
Copyright © 2015 by Diplomat Media Events Design by Diplomat Media Events