Walking the FinTech Tightrope

Walking the FinTech Tightrope between disruption and purpose: Teamspirit and The Memo Breakfast Event

As a specialist financial services communications agency, in recent years we’ve been fascinated by the potential tension between fintechs launching to tackle market ‘failure’ while needing to partner with long established ‘failing’ providers to scale. To find out how brands were navigating this challenge, yesterday we hosted a panel discussion with tech title The Memo on where next in the hunt for sustainable growth.

Held in design space The Piano Lounge in Clerkenwell, the event was chaired by Oliver Smith, senior tech reporter and fintech commentator at The Memo, with a brilliant panel of thought leaders - Chris Michael, CTO Open Banking, Brad Goodall, Co-founder and CDO 10x Banking, Ishaan Malhi Founder and CEO Trussle, Mihai Ivascu Founder and CEO Moneymailme and Samantha (Sam) Seaton MD Momentum UK and Moneyhub.

Oliver opened by pointing out that in his view the fintech sector was transitioning from the ‘angry teenage years’ of 2011 and 2012 when the likes of Transferwise and Nutmeg boasted that fintechs would takeover banks to a more mature state. The narrative had shifted from disruption for disruption’s sake to how to collaborate with established institutions to reach a mass audience.

There was a shared agreement that partnership presented real opportunity. It provided a means of translating the much needed disruption fintechs brought to industry into innovation that put consumers’ experience at the heart of product and digital design. This shift to consumer first was fundamental although according to Sam Seaton the pace of change had not been (and could not be) realised as fast as it should be because of the cultural brake from ‘300 year old institutions having to partner with 300 day old fintechs’.

According to Brad Goodall, partnerships between fintechs and banking institutions were the key to providing a frictionless digital experience. In his view, this collaboration would be key for the sector to meet consumer expectation into the future. This was echoed by Mihai Ivascu, founder of Moneymailme and Ishaan Malhi, founder and CEO of Trussle. As start-ups they believed partnerships were fundamental to growth. Mihai discussed their recent partnership with Silicon Valley Bank while Ishaan highlighted Trussle’s partnership with Zoopla and Revolut.

When it came to the panel’s view on sources of disruption in the future, open banking and the introduction of API standards was seen as transformative. Chris Michael from Open Banking described how open APIs would break down barriers and accelerate cross-industry collaboration while shifting control of personal data to consumers. This presented some risk that in Chris’ view required industry to take action to improve customer understanding and ability to manage.

For Sam Seaton, the benefits of this transformation would be huge. She saw it creating a universal platform for fintechs and established providers that would unlock innovation to benefit consumers. One of the obvious implications would be that brand – and a clear purpose – would only become more important as a source of differentiation.

The advent of fintech and AI was forecast to bring the end of face to face customer engagement but there was a shared view this was a gross simplification of what would happen. While bank branches could die out in their current form – only five people in the audience having visited a bank branch in the last month – Ishaan forecast the rise of ‘pop up’ stores for financial services. In his view, the sector should take inspiration from retailers and consider how to provide face to face consultancy whether that be to support consumers through applying for a mortgage or providing a LISA outlet.

Looking at both immediate in-sector disruption and the wider political environment, there was real optimism. Rather than seeing Brexit and regulatory change as barriers to growth they should be considered in terms of opportunity they would bring. This brought a neat end to a discussion. Reflection on the entrepreneurial spirit that typifies fintech and the restless innovation that puts consumers back at the heart of financial services.