Of the banking executives surveyed, 54% described fintech firms as potential partners, while 89% think that these sorts of partnerships will become ubiquitous in the next decade.
On the other hand, 58% of the surveyed fintech firms see potential advantages to working with the banks as a means of tapping into the client bases of mid-sized and smaller banks. Potential benefits for the banks include improved customer service, enhanced mobile capabilities, lower capital and operating costs, and lower lending rates.
81% of regional and community banks are already collaborating fintech firms, while 86% of respondents said that working with fintech companies is either “absolutely essential” or “very important”.
Data security is a major challenge for banks and fintechs. Almost half of regional and community bank respondents are either “somewhat prepared” or “somewhat unprepared” for collaborating with fintech firms, with data security seemingly a major factor in creating that uncertainty.
In September 2016, Radius Bank announced it would team up with online lender Prosper in an innovative deal to help make small business loans, a model that continues the collaboration theme demonstrated by other banks and lending platforms, such as JPMorgan Chase and OnDeck and Regions Bank and Avant
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