Banks Globally Rushing to Acquire Fintech Startups

Out of 265 global banks balloted by IDC financial insights, 6 in 10 are open to collaborate with fintech startups. The survey further announces the collaboration of 34% banks with a fintech company and 25% for an acquisition. While the relationship between fintechs and banks is improving, the bank still needs to work a little more to implement lessons learned from fintechs for accomplishing a disruptive digital transformation.

Rob Hetherington, the global head of financial services at SAP, said that an interesting and slightly different relationship exists between fintech firms and banks wherein banks act as the medium for digital transformation, seeking for lucrative ways to attract consumers and delivering quality solutions. On the contrary, startup firms bring forward a digitized and quick approach to build consumer confidence. Needless to say, a collaboration between both will result into greater customer acquisition and satisfaction.

In contempt of all this, it is seen that 250 corporate and retail banks surveyed across EMEA are seen forcing themselves into partnerships without any company-wide plan, creating “islands of innovation”. This would prevent them from acquiring the advantages of digital transformation at a managerial level.

The findings from the survey also reveal that only 1 in 4 of EMEA banks adopt a company-wide approach to create added value for their customers through digital transformation projects.

Banks can easily expand their services with consumers and become a lifelong partner by diminishing the lines between front-office and back-office initiatives. It will further result in a comprehensive approach to digitized transformation.

The research director for IDC financial insights, Jerry Silva says that “Digital transformation at any bank always starts with an open and honest self-assessment involving many questions that have something to do with emerging customer needs, influence, fragility and the competitor environment. Therefore, banks must invest in a full digital transformation strategy by creating an involvement of dead-level, a leadership structure for enterprise-wide transformation and an infrastructure that supports partnerships.” Needless to say, fintech startups