Fintech firms are mitigating the fighting talk, which manifested the start of the movement where it was evident that they have no other choice but to succeed without seeking help from incumbent banks.
Capgemini’s World Fintech report draws a conclusion regarding ‘fizzling out’ of the most talked about Fintech revolution.
Moving forward with harmonious strengths, Fintech startups are showing an inclination to enter into a symbiotic collaboration with the financial services firms, they once desired to knock over, Capgemini study suggested.
The biggest challenge relates to the scaling-up and creation of business models, which are financially viable.
The report further explained that despite raising almost US$110 billion since 2009, the Fintech firms might not succeed until an effective partnership ecosystem is built among them.
In the mean time, traditional financial institutions are embracing numerous agile Fintech customer service enhancements.
However, they retain risk management, access to capital, infrastructure, customer trust and regulatory expertise, as their strengths.
“With more than 75% of Fintech firms identifying their primary business objective as collaborating with traditional firms, it is essential that both Fintechs and traditional firms transform their business models by collaborating to drive innovation while retaining customer trust.
Without an agile and committed collaboration partner, both traditional and Fintech firms risk failure,” explains Anirban Bose, head of Capgemini’s financial services global strategic business Unit.
Endorsing the views of an identical report published by Accenture yesterday, Capgemini identified that over 70% of Fintech executives iterated that one of their top challenges to engaging with traditional financial firms was the lack of agility of such firms.
Whereas, changing the internal culture and negative impacts of incumbents on brand, customer trust, are other challenges.
Both Capgemini and Accenture propose the introduction of a systematic process for banks to draft their affiliation with startups. In this regard, Capgemini has developed a ‘ScaleUp Certification’ tool, which constitutes a prototype for bilateral verification and collaboration among partner organisations.