Mobile payments, machine learning, and robotic investing are among the latest win-win disruptive innovations that are reshaping transactions, lending practices, and customer experiences in the financial sector. Just last year, CB Insights reported more financial technology (fintech) startup acquisitions occurred in 2017 by leading U.S. banks than any other year.
To add to the disruption, fintech startups worldwide are transforming how consumers manage their money. Banking apps are reshaping mobile payment systems, live chatbots are in full effect, and interfaces are redefining the traditional banking models. Banks are realizing how much stronger the customer experience is when it’s delivered through fintech rather than simply offering free checking and savings accounts as promotions.
The fintech/banking partnership is an ideal pairing. A key driver for making this marriage work is customer-centricity. The partnership of a fintech and a bank can allow both businesses to focus on delivering customer value through technology, transparency, and simplicity.
One of the main challenges faced by the financial services industry is connecting customers and building customer trust. With customer-centricity, technology companies are viewed as even more responsible for the end users.
Advantages of fintech have brought technology disruptors to the front of the line with banks. At SXSW this year, Capital One rented out Antone’s, a well-known blues club for four days. The bank meant business, hosting a series of fintech events and highlighting Capital One’s own fintech innovations, such as its latest chatbot, Eno. Eno was developed as part of an effort to provide digital transparency to consumers.
The bond between banking, digital, and technology in financial services is a game-changer. For example, if it takes a customer only a few minutes to open a bank account online, visiting a branch office makes little sense. And banks such as ING and others have converted their banking into cashless units.
This is the future.
For more on fintech in banking, see Embracing Digital Transformation: The Future Of Banking.