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Banking Strategy and FinTech

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The strategic quote …

A strategic inflection point is that moment when some combination of technological innovation, market evolution, and customer perception requires the company to make a radical shift or die. Andy Grove, Only the Paranoid Survive

… setting the scene

I have covered, within a number of complementary post*; perspectives on banking strategy and the onset of the digitally centered fourth industrial revolution. A decade after the financial crisis the banking landscape has altered dramatically, over this period we have seen rise of the Financial Services Technology (FinTech) sector. 

What exactly is Fintech?

Put simply, a FinTech is an abbreviation for Financial Technology and the aim of FinTechs is to afford products and/ or services to the financial services sector covering brand, customer, channel, middle and back office value chain solution components.

The growth and increased prominence of FinTechs is nothing short of phenomenal: from a low base, the sector has seen the creation of innovation hubs, academies, accelerators and global regulatory sandboxes**, with the UK leading the charge. It should be noted that recent regulations such as the Payment Service Directive (‘PSD2’) and the General Data Protection Regulation ('GDPR') coupled with higher buyer expectations have left a few FinTechs by the wayside. This said, Open Banking has presented significant opportunities for those that operate within the Retail Banking sector.

The FinTech gold rush

We are in the midst of a gold rush in respect to innovation and the collection of FinTechs’ ecosystem partner badges. FinTechs, leveraged in the right way can revitalise brands and the human experience (i.e. CX, UX and EX) whilst maximising the value of data.

However, at a recent FinTech event that I attended, there was a sense of FinTech enthusiasm coupled with a degree of FinTech fatigue; whilst there was an acknowledgement that change is required, and that FinTechs can play an integral role in enabling change. There were concerns that in a perceived rush to attain a FinTech badge, patch work solutions were being developed and that the original business drivers were being lost.

As an advocate of financial services innovation and FinTech, I welcome and embrace the FinTech revolution. I am enthused by the opportunities that FinTechs can enable across the financial services sector.

The market challenge now is to make sense of the overabundance of choice, and make the right FinTech choices.

The gamification of FinTechs and ecosystem plays

Strategically aligned FinTech-partner-driven capability can enable organisations to penetrate new markets/ segments, lower costs, increase revenues, improve margins and revitalise relationships. However, the impact of getting FinTech partnering wrong can be extremely costly and have a detrimental impact upon the customer, brand and the balance sheet.

In the quest for a FinTech/ecosystem badge, there is a risk of ‘gamification’ - the impact being that sub-optimal decisions are made that may result in sub-optimal outcomes. Having spent the best part of my career advising the C-Suite on build-, buy- and partner-enabled transformations; and the remediation of such transformation programs, it is clear that:

sub-optimal decision making is painful and costly to remediate.

The FinTech alignment challenge

It important to understand where and how FinTechs can support and add value to new and existing business and operating models. Ahead of embarking upon a FinTech strategy, it is important to consider the following (not an exhaustive list):

  • How do FinTechs support and align with strategic objectives?
  • How do FinTechs support current and potential business and operating models?
  • How can maximum business benefit be derived from adopting a FinTech ecosystems?
  • How well understood and integrated is the target / adopted FinTech ecosystem?
  • What are the execution, run and innovation considerations?
  • How can you guard against gamification?

The differentiating opportunities that can be leveraged by FinTechs are significant. Whether you are at an inflection point, or embarking upon a FinTech enabled transformation - it is important to:

ensure strategic alignment at all times, guard against gamification and importantly - seek the right counsel.

If you would like to discuss any of the themes mentioned in this or any of my other articles, please do not hesitate to contact me via LinkedIn. Please feel free to like and share this post – sharing is caring, after all.

About Ambrish: Ambrish is an accomplished, well-rounded financial services director with a 20-year career spent shaping and delivering business outcomes. He is an executive-board-level advisor at the intersection of business, technology, digital transformation and FinTech (

*Associated Banking Strategy Posts

**Note: Regulatory Sandbox: A regulatory driven framework that is set up by a regulator that allows FinTech start-ups/ innovators to conduct Production product and / or service testing in a regulated and supervised environment.

All views expressed are my own.




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