At the recent Sibos conference in Australia, the CEO of ANZ, Shayne Elliott, touched upon an old argument in the FinTech space – disruption vs. collaboration[1].
Initial perceptions of FinTech startups pegged them as standalone disruptors of the financial ecosystem. The consensus within the financial sector is shifting though and, as Elliott indicated, there’s a different trend starting to emerge across the board.
“The interesting development we’ve seen over the last 18 months or so is a shift to the view banks will work with FinTech – rather than FinTech replacing banks.”
Elliott also emphasized that although FinTech technologies do not necessarily spell the end of banking, “they can certainly spell the end of banks which don’t rapidly adapt, which have leaders lacking flexible mindsets, or which lose sight of what their customers value.”
Recent studies would suggest that both factions believe that the opportunity in collaboration is perhaps bigger than the opportunity in pure disruption, especially in the era of Open Banking[2] that is taking hold in Europe and elsewhere around the globe[3].
Oleg Boyko, Chairman and Founder of Finstar Financial Group, a private equity firm operating in Europe, the US, Asia, Latin America & the CIS, believes that changes in consumer behavior, advances in cloud-based technology[4], the growing power and availability of mobile devices[5], and the emergence of data science are challenging the business models of traditional financial institutions. But Boyko also believes partnerships between FinTechs and banks will bring strategic value to both sides – the philosophy of partnership will add strategic value, insight, and management proficiency.
