Dr. Matthaeus Sielecki, Head of Disruptive Technologies & Client Innovation, Trade Finance & Cash Management Corporates, Deutsche Bank, has been featured in Let’s Talk Payments where he argues that the next wave of payment FinTech innovation will undoubtedly come from FinTech-bank or digital ecosystem-bank collaborations. Sielecki believes the reason is clear: in a highly regulated market such as financial services, neither type of organisation can innovate and scale on its own.
Sielecki notes there are many ways in which banks’ organisation and culture inhibit innovation. All large organisations must work hard to maintain a culture open to change, but banks are additionally hampered by legacy infrastructures and having to ensure that every change conforms to regulation. Also, as custodians of customer money, they are constitutionally cautious.
FinTechs can also find it hard to succeed on their own Sielecki explains. They may have developed innovative solutions that are highly appealing to customers, yet may lack one or several of the other crucial ingredients required to translate this into a viable customer product or service or scale it up for success, whether processing infrastructure, global reach, regulatory expertise, or knowledge of how the customers of the financial service sector behave.
Sielecki thinks that in contrast, by pooling both organisations’ resources, a bank-FinTech alliance can align strengths, while addressing any shortcomings. Together, they can find the best ways of serving business customers in the digital age – by combining cutting-edge creativity with proven processes and infrastructure.
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