There were bound to be growing pains in the friendship between banks and fintech.
After all, their worlds are vastly different. Startups tend to have a fail-fast mentality. Banks tend to take things slow to purposely avoid failure. Startups can dig into their niche and be really good at just that. Banks, for the most part, are vast organizations with multiple functions and legacy technology.
We asked bankers who are plugged into the world of innovation to give both sides some advice on how they can address these fundamental cultural differences to make their partnerships successful.
Head of global technology strategy, innovation and partnerships, JPMorgan Chase
Many fintechs have begun to shift their focus from competing directly with traditional banks to identifying opportunities to partner. We think ultimately there are a lot of synergies. In the fintech space, the reality is our strengths and opportunities are quite complementary with emerging entrants as we look for speed to market and fresh thinking. We collaborate closely with our fintech partners in an agile approach where we typically pilot early and look to fail fast and learn. This allows us to bring to market innovative solutions with the highest level controls, resiliency and security.
Vice president, retail operations and strategy, Avidia Bank
Collaboration is key to the success of both banks and fintech companies. Bankers need to get out from behind their mahogany desks and adopt a start-up mentality. This doesn't mean to throw structure out the window, but to stop living on hundreds of years of business as usual.
Fintech companies, embrace the banks that want to learn. Share their story and they will share yours. Teach them, take them along for the ride. Leverage their networks and in the end we'll all be better together.
Senior strategist, enterprise technology and operations, Zions Bancorp.
While there are many bankers that launched fintech startups, many fintech startups have been started by people outside of financial services. The bankers in their suits, and the tech entrepreneurs in their hoodies belong to different cultures. The strength of the traditional banker is the balance of customer satisfaction and risk mitigation. The strength of the tech entrepreneur is the balance of customer experience and application of efficient technology.
Admitting the differences is a great first step towards understanding each other. Secondly, being aware of each other's strengths, and weaknesses, is paramount. True collaboration comes from understanding.