Learning Objectives:
- How banks and card networks bring new fintechs into the payments ecosystem
- How fintechs & emerging payments like Buy Now Pay Later, NFTs/Crypto, and contactless which surged in usage during the pandemic create new opportunities for businesses and consumers
- How to best work with fintechs and integrate them to expand and grow acceptance
John Adams (00:09):
Welcome. Thank you for joining us. This is Open for Business with fintechs. I am John Adams from American Banker. The banks over the past few years have increased their work with fintechs to speed time the market to aid with development of products, and to just embrace innovation more efficiently. We have a great panel here to discuss that topic here today, and I ask you to just go down the line and introduce yourselves and tell us a bit about your company and what you do.
Peter Gasparro (00:41):
Sure. I will give it a start. Thank you everybody for attending. Peter Gasparro. I am the Chief Development Officer for Barclay's US Consumer Bank. I have been in the financial services industry for over 30 years, 25 of that with JP Morgan, previous to that with a smaller issuer. And so in my role oversee the growth opportunities for the bank as well as our business strategy and our banking products. So most of you probably recognize Barclays in the US as a co-brand credit card issuer. So our brand is not out there. We stand behind American Airlines or JetBlue or the Gap or some of the brands that we stand behind, but we actually do have a high yield savings account program as well as a consumer loans product. So thank you for having us.
Cathryn Peirce (01:36):
Hello, my name is Cathryn Peirce. I am founder and CEO of Carbon Zero Financial and also to whomever handed my cell phone. Bless you. Thank you for that. My background is actually in behavioral change, so did a lot of work in sexual violence prevention, women is investing, and I am fascinated by the dissonance between our purported values and the frequency with which we actually act on those values. Or in this case, transact. I was director of marketing at a brokerage and then founded Carbon Zero Financial. We build white label ESG features that can be added to card products such that every card holder can automatically measure offset and reduce their carbon impact as they spend. So I spend most of my time cajoling banks to move a little faster.
Jagdeep Sahota (02:23):
Hey, good afternoon. My name is Jagdeep Sahota. I am the Chief payments Officer at Bank of California. We are OCCA regulated right under 10 billion business and commercial bank based out of Santa Ana, California. My background is about 18 years in payments spread across system architecture at Visa, product Management at PayPal, innovation at Visa, JP Morgan for a lot, work on Chase for business and Chase Connect products and NMI Salesforce partnerships, and then JB Bank of California for about eight months now. I am currently focused on launching commercial card products for Bank of California as well as building something very similar to what was talked about in a panel earlier payment as a service using a third party solution. And lastly, we acquired a payment gateway called Deep Stack and we are integrating that into our acceptance solution. So look forward to the conversation here.
John Adams (03:24):
Be starting a little broad, but how do you work with, if you are with the bank, with the fintechs or FinTech with banks, what is some of the work that you do in terms of partnering or collaborating on projects? How does some of that work?
Peter Gasparro (03:44):
You want me to go?
John Adams (03:45):
Sure, yeah.
Peter Gasparro (03:45):
We can go right down. We can go right down. We will start that way and then we will toss it up. So a couple different ways we do it at Barclays, one of the things that I did when I took over the role two years ago is actually within my strategy organization, I set up an emerging opportunities group. So you have to, what I have learned over the years is you have to have a team that is looking to willing to look around the corner that can look at things that are non-traditional because they are also going to get tied up in what the mothership I call it, is doing all day long. And so you have to have that entrepreneurial spirit, that intellectual curiosity and a team that can look around the corner. We have some partnerships in place today. We work with a Mount on our Buy Now pay leader solution that we're coming to market with. We have other card feature enhancements that we work with some fintechs on, but most importantly, I think it is very important for any industry to have a team that is nimble enough and that is intellectually curious enough to spend time with FinTech.
Cathryn Peirce (04:47):
I would echo that sentiment. For us, many banks, all banks recognize that both consumer demand and corporate mandate around ESG has increased. There is been a proliferation of people wanting technology that facilitates with climate reduction. Banks, however, did not become banks to build climate technology. And as such, when they want to capitalize on this increased demand, they turn to us, we build white label technology by which they can kind of meet consumers where they are with this demand without fundamentally tweaking or putting a lot of new teams together to do so. So, for us, it is about as banks want to maintain competition as they want to outpace Neobank as they want to attract the next generation of users, they turn to fintechs such as ourselves to keep their products as innovative as possible. And for us, that is specifically within the realm of climate.
Jagdeep Sahota (05:40):
Yes. So I think it is similar themes. We have to look at what customer segment the FinTech is going after. Is that a customer segment that we can work with? So our objective at Bank of California, and given some of the investments we have done with some of the funds and the fintechs out there has been is are they working on a product going to serve our need or our customer is need? So we want to be the first ones that go to market with them together and launch that product. So we currently sponsor someone who does accounts payable for commercial clients and they use our bin with a program manager behind them. So we are looking for FinTech opportunities that are going to expand our footprint, our product set, and then be a good fit for us overall, not just looking for interchange revenue. That is not the focus for us.
John Adams (06:28):
Are we seeing more of this activity than we were say three or four years ago? We are bank some fintechs working together more than they have in the past?
Jagdeep Sahota (06:38):
I do not think it is more, I think it is just seeing more people talk about it and that sort of bank is versus FinTech narrative has gone away and people are actually working together and talking about that. You can add value to each other. It is just sometimes in media or to get clickbait, it is easier to talk about banks versus, or JP Morgan or Diamond hates Bitcoin. That gets you clickbait, but that is not the reality of it. I mean, I have been on both sides on the FinTech side and the bank side. I do not think there is friction. It is just trying to find right partner and the right value set.
Cathryn Peirce (07:13):
I will say, however, I think that both fintechs and banks have been humbled in the past three to four years. Fintechs that endeavored to launch their own credit products realize that compliance is not fun. But there is actually a lot that banks do that we were not equipped to or forecasting or fundamentally just were not why we started our businesses. And likewise, I think a lot of banks realized, oh, maybe these fintechs are up to something. Maybe they have a greater pulse on what is trending, what is current, what is coming around the corner. So I think each had a bit of a wake up call and in so doing realized, okay, there is in fact greater scale, greater impact and profitability if we do join forces. And I think we are all endeavoring to do that now with some friction, but we are all still trying to find that collaborative spirit now.
John Adams (07:57):
And Catherine mentioned friction this morning during one of the panels, the most influential women in payments Carol rang from KeyBank mentioned the concept of frenemies involving banks and FinTech. How is that changing? Is it something that there is less of an issue than it was in the past for some of the reasons we have discussed? Or are there still at times issues that have to be worked through?
Cathryn Peirce (08:23):
I think I like to think of this panel and frankly all of what we were discussing as couples counseling for fintechs and banks, I do not think Frey is accurate, but I do think we have very different approaches. The pace at which a FinTech startup wants to move is completely antithetical to the pace at which a bank is often moving. Likewise, a FinTech quite frankly is trying to survive. We are thinking about in the next three months, not necessarily contracts in the next three years. So I think one, managing expectations, being able to identify how effectively are we understanding each other's needs are in fact appropriate partners at this time. Fundamentally, it comes down to communication, being very transparent, asking the right questions, and I know we will cover some of that later, but I do not think it is frenemies. But I do think it is trying to find the partner with whom you are most compatible, which is very much kind of life in general.
Peter Gasparro (09:12):
Yeah, I would just echo that. I think it is alignment. I think you said it well. I think what is happened over the years is it is been a decade plus that we have been talking about fintechs. As a matter of fact, Barclays was a FinTech not that long ago. Juniper Bank started Barclays in the year 2000. So it is 20 some odd years ago, but it was a startup in itself eventually acquired by Barclays. But again, understanding, having goal alignment I think is super important. Not talking past each other. And for the fintechs who are approaching banks and financial institutions, what I would say is most of them are starting to realize do not be tone deaf, be self-aware. Understand that we do have compliance, we do have regulations, we do have rules, and we are regulated bodies, whether it is the FDIC or the OCC or whatever our regulating body is.
(09:57)
So if you come in tone deaf to that and believe that we are going to be able to execute something in 30 to 60 days, most likely you are going to get frustrated and nothing is going to happen. So I would rather you come in prepared knowing what my challenges are and what my obstacles are, and the more that you are aware of that, the more I am going to be receptive to have a conversation with you about that because it is going to be easier for me to navigate my waters. So I would say that as this dance has been going on for 20 years, we have both learned it a little bit more, and I think on both sides we are getting a little bit faster and the fintechs that are approaching us are becoming more aware and saying, we have understood this. We have dealt with the regulators. Here is a way to approach this.
John Adams (10:38):
Can there be challenges? What are some of the challenges in having those conversations and how do you overcome those for us?
Peter Gasparro (10:46):
Then I will pass on, speed is usually and prioritization. So you have to understand that what is fast to you, as was just stated in two to three months, for me it is probably within 12 months. So we just have to get aligned on speed, and then we often have to understand the prioritization. Yes, we have large technology budgets, we spend hundreds of millions of dollars a year on technology, but those budgets are prioritized in many cases a year and a half out. So you also have to know how to get into that cycle, and if you become aware of that, then I think both parties can work well together.
Cathryn Peirce (11:22):
I think anounce of prevention is worth a pound of cure, asking the right questions from jump. So one even how do you define innovation? There is people with whom we have had conversations and innovation is getting a help chat box on their website that may in fact feel innovative to them. And we obviously support those efforts. Well wishes that is not what we are doing. We are trying to look to the future. We are trying to attract the next generation. So one, even just defining our terms, is this, is our innovation, the type that you are looking for or able to adopt, being very transparent about bandwidth, is this actually something that is likely to take priority? What are the other kind of fires you are trying to put out in this economy in particular? What is the likelihood of this getting done? Am I speaking to the right stakeholder? These are very large organizations and very often FinTech reaches out thinking they are speaking to the right person.
(12:08)
So I think the greater transparency with which we can conduct these conversations, even if it is not the right fit at the time, it at least creates a very good environment to be able to explore it in the future, to have mutual respect, kind of mutual trust. So for us, it is very much asking as many questions from jump. How do we actually align KPIs? How do we know your needs and serve them effectively? And what does it look like to start inch by inch kind of through a pilot, through addressing the specific pain point you have, building a successful partnership, which fundamentally, that is what we all want to do. that is exactly right. At the end of the day, we do actually have the same intent. It is just making sure that we are keeping open communication and managing expectations on the road to get there.
Jagdeep Sahota (12:47):
Yeah, I mean, do not come in from, one of the biggest challenges is do not try and come in and change the clock speed of an institution that is been around for a lock time. You try and put that gear right into the fifth, and we are running on first, not going to work. So slow down, but at the same time, try and find a match. Bring me a problem that my consumer, that persona, that archetype that you are trying to do. What is my addressable customer segment of that? Can I even take that mark to out there? So just saying, oh, ESG is huge. Great. I do not have a card product. Not useful. So we do not have a match. I do not like to jerk fintechs around. I do not like to jerk windows around. If we have an opportunity, we will work. If we do not have an opportunity, we won't work.
(13:33)
But putting a chat bat on some bank may be an issue that works for them because their problem statement is reduce the call center volume. So you have to start with what is a consumer problem that I am trying to solve and what is my cost center or my profit or what my in, I am trying to bring in fee income. So I am looking for opportunities that, so anyone out there who wants to work with me, fee income. So if you bring me fintechs that are trying to solve fee income, I am talking to you if trying to do something else, not really interested right now. So I think it is very important to align on that larger goal. What is my North Star, which way I am going to get the right FinTech partnership going?
Cathryn Peirce (14:13):
And I would just hop on that to say that type of awareness, knowing what you are really looking for. I think very often innovation teams, it is all excited about a lot of things, but the greater that your needs, you are very clear in what you are looking for, the more effectively you can source, find and create successful partnerships with fintechs.
John Adams (14:32):
When we are in a market like this where there is a lot of volatility, a lot of unknown in terms of the health of the economy moving ahead, does that change any of this dynamic in any way in terms of cycles speed, particularly if one part of an industry, the cycles are shorter than another. How does that impact partnerships or working together?
Peter Gasparro (14:55):
I do not think it should. I think if you are principal driven, and again what I said, what we try to do is we try to set aside some investment dollars for innovation or we side set aside some technology teams and some development staff to be able to do this because if you do not really set it aside, it is going to get lost in all the big things that you have to do. And I do believe that there is a need to test innovation and to partner with third parties in order to deliver that, because I think it happens a lot quicker than we can do it on our own. It enables us to test a lot quicker and perhaps exit a lot quicker if we need to as well. So I do not think you have to manage this through the cycle, and I think that you should be disciplined enough to have set of principles and if you can, some investment dollars set aside to participate.
Jagdeep Sahota (15:48):
It is just, sorry. Oh, no, no, good. I was just try explaining that to the OCC that I am going to go and do a pilot over here and do not look over here because it is just a pilot and I am doing it in agile. You understand agile, right? So I am not going to go through the 18 month cycle of going to the board. I just have this slush fund over here that I am going to use. It does not work. I do not have a sugar daddy of a VC sitting here that I can run to. It does not work that way because it is not my bank, it is not my executive. It is just how the industry and the regulator is structured. So if you come in from a FinTech VC mindset and you do not know anything about the operating model of a bank, you are going to just stick with me and bang your head and get tired.
(16:36)
But if you know that this guy has to go in front of a board and a committee and then get his money, and then he is going to try and do something the way OCC wants it to because they are looking down at my project plans and making sure I am running it by the project plan, I have a RAID thing going on the side here, it is like it is just a different operating model. And if you come in, know that coming in and be able to sell me why I should work with you and how we can work together with that operating model.
Peter Gasparro (17:05):
But if you know that you have got regulating bodies, you have the occ, we have the FDC and the Fed, if you know that, and we had OCC at JP Morgan, if you know that you have regulating bodies and that you have a principle set of tenants that you need to go through in order to achieve success, knowing that and going through that does not disallow you from having the opportunity to spend some money on innovation and some new ideas. You can sandbox some of those ideas if it gets missed up in the entire budget. What I would say, my challenge, and again, it is my opinion of one, is if you co-mingle it with the entire spending, whatever your spending budget is, I think it will be a challenge to ever allocate anything. It always falls to the bottom.
Cathryn Peirce (17:48):
And to that end, I would echo, I think if you have not prioritized it and really allocated both personnel and capital to it, it is easy to fall by the wayside. We have seen the kind of capric with which priorities change, at least for features that will be added. So after an IPCC report, I am going to have inbounds from banks saying, yes, we care about climate. We know it is important, and that can kind of fall to the wayside. And so we have seen how these trends change. Fundamentally though, for us, we understand then that banks are a slower contract and this is ultimately about relationships. And so in the meantime, there is FinTech to whom we can sell. There is trying to iterate on if we are B2B, who else can constitute that B, but understanding, all right, if this is a slower operating model, how do we tee these up for the long term? This is more about a pipeline than immediate implementation. And then occasionally you will in fact find an executive at a bank who feels very passionately, who sees the market research and does want to implement. But it certainly is, I think it is a slower process. And we have experienced some susceptibility of wavering changes, commitments to where they think the priority is in terms of innovation, not yours. I like the principle driven approach.
John Adams (19:02):
How can banks that and FinTech set themselves up for the most productive and profitable project possible, including stuff like design, pilot tests and other parts of the process?
Peter Gasparro (19:16):
Jagdeep, want to take that. Go ahead.
Jagdeep Sahota (19:18):
I mean, start with clear objectives. Have the target segment defined as be was saying you can have pilots, you can have MVPs. It is not that banks do not know how to do it. There was a statement earlier in a panel, they were talking about, oh, banks are not technology companies. I was like, what do you think my Fiserv core is? I know it is not owned by me, but what banks have been using technology for a long time. We may not do development the same way, but if you come in with that understanding that we are going after the same goal, look, I am about to launch a card, she is got a product that rides on the back of the card, we may end up working together, right? Because it is the right time, the right opportunity. So if someone comes in today trying to sell me a new core, not can not switch it. So I think where you are in that cycle and what product makes sense is very important. And other than that, I think we can always find money, even though I say we do not have one, I can plan it out. We have enough money to make it happen. If you can tell me why this matters to me or to my consumer.
Cathryn Peirce (20:26):
I would say based on the women, the impressive women we heard from earlier, maybe do not look for the sugar daddies. Look for the sugar mamas. I would say, yeah, in terms of setting up for success, it is have managing expectations, actually knowing your bandwidth. And again, if we are, I keep likening this to kind of couples counseling, do you have the bandwidth for a partner right now? What trauma or baggage are you bringing into this conversation? What fear of fraud, what the, having very transparent understanding of what is it you want to work on? What is it you want to accomplish? Do you actually know your consumers well enough to know that this will be a success? And then what does it look like to gradually take these steps? I personally do love the sandbox environment in which we can take some of your consumers and really trek, test the efficacy of the technology, see how successful it is, make some tweaks before we do that rollout. So having an iterative process, but it really knowing your consumers, knowing your own kind of commitment to innovation, that makes for far more conducive conversations. And frankly, we can tell the difference between a bank that does not really know where they are going, does not entirely know their consumers, is kind of throwing things at the wall and then a bank that says, all right, this is what we are hearing. This is how we would like to take this forward. I think patience on both sides, but more than anything, just being as communicative, open, transparent, and self-aware as possible.
John Adams (21:39):
We have talked a bit about pain points there. Is there a particular way that you figure out what a partner that you forgot what you are struggling with, be it speed or anything like that you make the where you decision it is time to seek out a partner is do you have an internal process where you know, figure out where you know need to go to get help?
Peter Gasparro (22:06):
Well, I think that is just it. I think having a process is important. So I am going to blame us on the side of the banks and the fintechs more than I am going to blame the entrepreneurs. Thanks. The entrepreneurs are great. I mean, their job is to find holes in the market, whatever that market is, and to exploit it. And they do that really, really well. Us that have spent our career in financial services. We are not typically the leaders out there sticking our neck out. We are usually fast followers. We watch a trend, we get a little bit more comfortable with it and we adapt. And that is what we do because we have the safety and soundness of a lot of customers and balance sheets and regulators on our that we have to take care of. So that is super important. But I would say have a process that is number one, understand what your filters are, understand what your principles are.
(22:57)
Do not bring all these folks in who are moving at a super fast pace and are perhaps trying to grow a business as an entrepreneur and waste their time. I try not to do that. We try to have a process. We partner with MasterCard as a matter of fact, around design thinking. We have an innovation lab that we set up with them. We have a sandbox where we can do really, really small things on other larger fintechs. Like I said, we have partnered with Mount, we have been on a multi-year journey in building our buy now pay later solution with them. We have a process, we have a third party oversight team, we have an engagement. So I would say just set yourself up internally for success and then hopefully you will have more success in this space.
Cathryn Peirce (23:40):
And something I will even add. So not everyone has the bandwidth to create a sandbox to custom that, etcetera. There are organizations, there are other startups in fact that create sandbox environments specifically to facilitate in this desire for fintechs and banks to work together. But the inability to necessarily test the technology because the bank does not have the infrastructure and the FinTech does not have the runway to just do a free custom project to see how it goes. So there are opportunities. There are in fact spaces, NI one is one with whom we are partnered specifically so that we can just get into a sandbox environment and try this before it goes any farther. So if you do not have the bandwidth to be building that on your own though, I think that is a tremendous investment in the future. The ability to bring things in, see how they work, etcetera, and own as much of that process as possible.
(24:26)
If you do in fact have to outsource that process, do so. But I think we do need to have an eye on the future. I talk a lot about Gen Z. Their buying power is expected to exceed that of millennials by 2030. When you start looking at various trends, what are you doing? Do you want to be flatfooted when it comes to the next generation of user acquisition when it comes to outcompeting, your competitors that already exist, and all the ones that are going to emerge that we do not even know about yet. So whether it is even just understanding what your process will look like, at least start taking steps that facilitate in your ability to innovate and compete over the next five to 10 years.
Jagdeep Sahota (25:06):
Just, I mean, word of caution. I have spent, I have gray hair from being spending time in innovation labs, do innovation in isolation. Do not do it in insulation, right? Because the minute you do it insulation, you try and bring into your main org your org is going to have an organ rejection because you did not bring the CTO on, you did not have the right consumer set on, you did not talk to legal, you did not talk to risk. So if you are going to do innovation and sandbox and the rest of it, do it in an isolated environment. But within your own core, make sure you find a progressive risk person, a progressive legal person, bring them together, create a forum for them to talk and work on a prototype. And the MVP is a sliver of the triangle that goes on the side, not at the bottom. So do not end up creating something that is very minimal product set. It has to start from UX and go all the way down to functionality. So there is ways to do innovation inside and build a and sandbox. If you do it in an IS isolated environment somewhere else, 90% of those fail when you try and bring them back into your core.
Peter Gasparro (26:10):
The other thing, just to be clear, and I am sure this crowd understands that, is that bringing forth innovation is not always chasing a shiny object that is unproven. I mean, innovation can be purposeful in the business that we're in. We're a partner led business. So Barclays in the US does not have a consumer brand per se, right? We talked earlier about the brands that we have. So our partners lead us into that innovation. What do they want to see in in-flight activity? That could be an example of innovation. I am sure many of you have flown on planes that we market our card on that there is an enormous amount of innovation that had to go around that to be compliant, to be able to work with those unionized employees. Think about that for a minute. We innovated on cruise ships where we were the first to ever take instant credit and provision a card immediately into the digital wallet, if you want to call it that.
(27:02)
So someone can actually get excited about using their purchases on that cruise ship immediately. And then being able to gather points and be engaged in that experience there is, there is innovation that is not always chasing a shiny object. There is a lot of innovation in our industry that you can do that is very purpose driven. Lead with your customers, lead with your objectives, have a process around design innovation with the right people. As jagdeep said, you have to have the right people around the table for that. But innovation does not have to be this shiny object waste of time. It can be very, very purposeful. And if it is purposeful, I think it can be successful.
Cathryn Peirce (27:40):
I would echo that. Do not chase trends. Choose strategy. I think if you do not have a sense of who you are trying to be and why, besides the fact that it is popular, that is probably not going to work. And it also would suggest you do not know your customers quite as well as you probably should. So maybe get acquainted with them. Do they actually want, whether that is your partner, like a gap in American Airlines or the very consumers with whom you are already working, but chasing trends is not in fact innovative. I think it is a little bit of fear-based, reactive thinking. Who do you want to be in the future? How do you want to attract them? What does that look like? How do you want to be known as a brand? These are some of the questions you can start with, but trends come and go. And so chasing the wrong ones can be very costly in time, in capital and in partnerships.
John Adams (28:29):
Well, we will have a couple of minutes if there is any questions from any questions from the audience.
Cathryn Peirce (28:36):
There is someone over here, right there.
Peter Gasparro (28:40):
Oh, she is coming with.
John Adams (28:41):
Okay. Yeah, there is a microphone on the way.
Cathryn Peirce (28:46):
Unless you feel like shouting.
Audience Member (28:53):
See, you guys touch a lot about different speeds and all this understanding, but if I am looking at the work between the fintechs and the banks, there is that an additional layer, and maybe you can correct me if that is that is real or not within actual bank, because banks are usually pretty large organization and you have that front facing or the FinTech facing side of the bank that seems to be more open and willing to do new things and experiment. And there is a risk compliance legal within the bank behind. How do you guys work to bridge the gap? What is that actually exciting partnerships happening that the risk and compliance is ready to step in and work within the bank, especially as the whole point of which was mentioned earlier of fintechs are going where the banks are, might not be willing to go as aggressive on the LE risk. There are more risk adverse. And that is that group risk compliance, legal, which is the most adverse to the risk to help bring that partnerships ones that technology seems to make sense. Operations makes two sense. All this seems like it really is a great feat, but it is stretching the boundaries. What typically that bank would do.
Jagdeep Sahota (30:19):
I mean, yeah, look there is some very strict standards on what the risk guy wants is to be AML, BSACIP compliant. If you are a FinTech that is willing to share your data all the way from onboarding to every transaction and you are willing to run through my transaction monitoring system and my persistent merchant monitoring. And the other things, and that is the other thing, we are sort of lumping a lot of business into FinTech, right? If you want me to underwrite lines of credit, that is a very different bar versus sponsoring a bin for you to do prepaid cards on. And the data I need from each side is different. So trying to say FinTech that I am going to work with everyone really depends on what line of business inside the bank you are trying to work with and what I am willing to take the risk on. I have to look the model validation for some things on other things. I do not have to look for model validation. So if you come into a bank, that front end partnership team may be great the forward we are thinking they are looking for it, but it is the people on the backend that are going to tell me where the bar is set for this to happen. And especially after a crossriver and what happened over the weekend, like that bar is only going to go higher.
Cathryn Peirce (31:34):
I think you have identified an inherent contradiction of how do people who are constantly saying, of course we can do this. It is riskier. It is exciting work with people who are like, actually no, you cannot. And I think fun for us, that means when we are speaking to that front facing team who is a FinTech partnership, etcetera, asking how collaboratively do you actually work with risk and compliance and legal, and do you have an understanding of what their bandwidth is and their comfort level? And so when I spoke earlier to the various stakeholders from whom you need the green light to actually get to implementation, part of that is just understanding or do you have a self-awareness of where the rest of your organization is actually going to fall with this? Where how will they receive this? To that end, we do also try and make it so that we can kind of have as many low security, low kind of compliance. Our specific business is trying to meet that, but understanding the threshold is important. And so when we talk about process, part of the process also has to be, does your front facing team actually have a realistic understanding of what the rest of this business considers a worthwhile partnership? And if that is misaligned, you are not probably using that team or even these opportunities as well as you could. So I think a lot of internal work, frankly, has to get done before you are even in a position to identify and actually have conversations with fintechs.
Jagdeep Sahota (32:53):
And I think from a bank perspective, sorry, I will just add one more thing. From a bank perspective, if you are looking to be a sponsor, start with building a data warehouse, transaction monitoring systems, realtime AML systems. So when a FinTech comes to you, if it is there in your sweet spot, and if you have the backend ready to do the Trump business that they are looking for, not all banks and all fintechs can work together because your backend is not ready for that setup.
Peter Gasparro (33:22):
I will just conclude on that. Stakeholder management is absolutely critical. And if you do not have first and second line alignment in terms of the second lines that you spoke to, and if you are a FinTech and you do not get immediate exposure early into a conversation as Catherine just said to those, then you are wasting your time because you absolutely have to have that first and second line involvement.
John Adams (33:47):
Well, we are at time. We want to thank we thank panel, the buzzer we springs. Really. Thank you. Thank you guys.
Peter Gasparro (33:54):
Thank you.
John Adams (33:55):
Thank you.
Cathryn Peirce (33:57):
Go out and innovate FinTech partnerships work.