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
KPMG Romania and Spherik Accelerator team up to support startups

The Romanian unit of international consultancy KPMG and Spherik Accelerator said they have launched Startup Growpad, a programme designed to support local startups.

 Read Full article »
Recruitment, retention and professional development of employees in the context of major changes in outsourcing

The Business Service Leaders Association (ABSL) organizes on May 24, 2018, at Ramada Hotel in Iasi, the conference "How HR Practices evolve in a period of major changes in outsourcing Industry". The third editi

 Read Full article »
Comdata acquires CCA International, deal should be finalized in June

After the acquisition, mid-2017, and the successful integration of B2S (now Comdata France), the Comdata group signed, yesterday, an agreement on the acquisition of CCA International, the company says.

 Read Full article »
ABSL Romania is offering 30 scholarships every year for postgraduate studies

Business Service Leaders Association Romania (ABSL) annually offers 30 scholarships in the Business Services Master program for young people wishing to pursue a career in the outsourcing industry. As a result o

 Read Full article »
Portland Trust and Ares Management LP have sold the suburban office park, Oregon Park, to Lion's Head Investments

Lion's Head Investments makes its first steps into the Romanian real-estate market and announces the acquisition of Portland Trust's and Ares Management's Oregon Park project, which consists of three class A Of

 Read Full article »
Amazon creates more than 650 new permanent jobs in Bucharest

Amazon and Amazon Web Services (AWS) today officially opened a new Corporate Office and Technology Development Centre in Bucharest and announced the creation of more than 650 permanent, technology-focused and c

 Read Full article »
Portland Trust's Oregon Park in Bucharest wins CEEQA's "Overall Building of the Year SEE"

Portland Trust, a commercial real estate developer and asset manager headquartered in Prague, announcesd that Building B at its Oregon Park office complex in the Romanian capital of Bucharest won the 2018 CEEQA

 Read Full article »
US Kellogg's opens new division at Bucharest

The US-based multinational food producer company, Kellogg's announced that it will create 50 jobs at its Bucharest centre by the end of 2018, by opening a new division at the Bucharest centre. The new positions

 Read Full article »
Techsylvania 2018 lines up powerful tech specialists at Cluj-Napoca between June 9-12

Techsylvania is the leading technology event in Eastern Europe, built to revitalize the local tech community through high-quality information delivered by worldwide experts in the IT&C industry. Engineers, deve

 Read Full article »
Accenture names Gianrodolfo Tonielli in the position of Country Managing Director in Romania

Starting May 2018, Gianrodolfo Tonielli takes over the position Country Managing Director of Accenture Romania, the company announced.

 Read Full article »
 
 
MOST READ ARTICLES
» The most appreciated companies from th...
» ROMANIAN OUTSOURCING AWARDS FOR EXCELL...
» DTZ: Office demand outside Bucharest t...
» Capgemini to open new office at Suceav...
» Molson Coors started to grow its busin...
» Romania, Europe's third and world's 13...
» Committed to growth
» Romanian software group expands to Bul...
» EXCLUSIVE: ABSL Timisoara - BPO and SS...
» Genpact's COO: Staying ahead of the cu...
 
EDITOR CHOICE
The need of the industry to stay effective and relevant

In the current context of machinery and AI helping on operational processes of a company, with extended applicability in terms of capabilities, the digital context in which professionals, organizations and busi

 Read Full article »
We meet again at OT Learning & Development on June 7th

The Second Edition of OT Learning & Development roundtable will be held on June 7, 2018 at InterContinental Hotel Bucharest. The event brings together the business services professionals to discuss and discover

 Read Full article »
The Outsourcing industry announces its winners at Romanian Outsourcing and Shared Services Awards, 2018 edition

Last night, Outsourcing Today and the Diplomat-Bucharest awarded the performance and excellence in business at the 4th edition of Romanian Outsourcing and Shared Services Awards ceremony, organized at Radisson

 Read Full article »
Ciprian Dan, Wipro BPS: The industry needs to take a more sophisticated turn

According to Ciprian Dan, Location Head at Wipro BPS, the language skills have not ceased to remain one of the competitive advantages for our market but to relate to this advantage as the sole plus is risky on

 Read Full article »
Olga Botusan, Stefanini: There is a huge need to develop particular skills for specific areas

Stefanini is a company strongly involved in the business shared industry not only for creating the demand for workforce and hiring but also for the programs developed in order to specialize the needed professio

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