Avoiding FinTech Flashpoints
James Perry from Bud shares his views on the relationship dynamics between incumbent banks and FinTechs including how to avoid a culture clash.
When FinTechs get together with traditional banks, what are the relationship dynamics?
We spoke to James Perry, Implementations specialist at Bud, a technology platform that links financial services together.
“If both companies are heading in different directions, then it can cause a clash.”
Q: What are the relationship dynamics when a traditional bank partners with a FinTech? What’s your own experience?
A: The relationship we have with banks is a partnership opposed to a client/vendor relationship. We work together to solve problems and create solutions for the banks' customers using the technical expertise of Bud and the bank's understanding of their customer. We have an open dialogue with the bank.
The teams we speak to communicate daily with the team implementing new digital propositions into the market – as well as other senior stakeholders across the bank. It’s hands-on work from dedicated people on either side who want to give end-users more control over their money.
Q: What are the pros and cons for both sides?
A: Banks are faced with changing consumer expectations and regulation is opening up new ways to add value to an individual’s life. As a tech-based business, we are geared to moving quickly and adapting to these changes, whereas banks need to be focused on keeping customers secure and appropriately managing risk coming into the bank.
A relationship like this allows both companies to play to their respective strengths – to ultimately have a positive and tangible effect on a customer's life.
Q: What if there are clashes of culture or things don’t go as planned? What systems, processes or understandings can help in these scenarios?
A: The biggest barrier to a successful partnership is a misalignment of vision. If both companies are heading in different directions, then it can cause a clash.
We've been lucky with a number of partners we've worked with, because there has been a belief, from both sides, in the vision. When the steps along the way are difficult, we come back to the vision and maintain that open channel of constructive dialogue.
It’s a simple recipe, but it keeps things moving and keeps the work honest. Banks are regulated differently to us, and most of the differences have stemmed from that. But the banks we work with are incredibly motivated by new technology developments and are looking to make ‘best in market’ products.
Read our feature on FinTech dynamics in Chartered Banker magazine.