The Fintech "supermarket": Banks react

Couple of weeks ago, we wrote: The bank de-bundling which then became re-bundling, now de-bundles in the absolute manner. We believe that decentralization will play its role in this trend in the years to come and blockchain will find in this use case, a solid purpose.

Let’s see what happens.

What happens is that banks react, they have a strategy they implement.

A recent study by Economist Impact, in collaboration with Temenos, casts a spotlight on a strategic shift: nearly half of the continent's banking institutions are now investing in fintech startups, with 36% taking the initiative to develop their own digital banks. This pivot is not just about keeping pace with innovation; it's a bold play to redefine the future of banking in Europe.

This strategic diversification highlights a proactive approach to harnessing the potential of cloud computing and artificial intelligence (AI) mainly, to enhance customer experience and operational efficiency. Over 20% identifying cloud technology as a critical focus area. This is complemented by a strong belief, shared by 75% of the respondents, in the significant impact generative AI will have on the banking sector.

In a landscape where consumer preferences and technological advancements evolve at breakneck speed, traditional banks are recalibrating their strategies to remain relevant both to their retail as well as to corporate clients.

Such a notable move was HSBC's launch of Zing, a multi-currency payments app designed to rival existing fintech offerings, showcasing how traditional banks are expanding their digital arsenals to capture a broader market share. ?

The concerted push towards investing in fintech startups and developing in-house digital banks signifies a strategic response to the competitive pressures exerted by neobanks, as we were discussing in our previous note.

By prioritizing cloud migration and AI adoption, these traditional institutions are not just aiming to compete; they are looking to lead the charge in defining the future of banking, as they have far more resources to invest in these critical directions than any neobank will ever have.

FUND4ALL already offers digital banking services and API orchestration for one EMI in London and we are just starting a project using generative AI support for a bank lending activity. We are project managers and we just know what to do.

Care for a call?

Visit https://fund4all.gr/ or contact us at [email protected] and let us discuss.