6 in 10 global banks would partner with a fintech

6 in 10 global banks would partner with a fintech

- in All News, Cryptocurrencies
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Six in 10 global banks would partner with a fintech company, while one in four would consider an acquisition of a fintech company, according to a survey conducted by IDC Financial Insights and sponsored by SAP SE.

The survey is included in the IDC e-book “The Future-Proof Digital Bank” and includes the answers of respondents from 265 retail and corporate banks on digital transformation (DX).

Among the main findings of the study are that even though banks claim to be digitally savvy, in reality the digitally transformative initiatives of the “traditional” financial institutions are isolated cases and true business-wide transformation is a rarity.

According to the survey results, North America is most focused on DX as business enabler with 40% of north North American banks investing more than a quarter of their IT budget in digital transformation initiatives. At the same time, the main reason banks in Europe, the Middle East and Africa invest in DX are the customers. A total of 57% of the respondents in these regions cite improved customer experience and 44% are focused on the front office. Latin American banks tend to build fragmented initiatives – 24% of the DX initiatives are focused on back office (4% higher than global average), while at the same time, 42% of the DX initiatives are focused on the front office. Meanwhile, the banks in Asia Pacific have a more advanced strategic approach with 29% having an organization-wide DX strategy. This is 28% than the average worldwide.

“The relationship between banks and start-ups is an interesting and nuanced one,” said Rob Hetherington, Global Head of Financial Services, SAP. “Banks are in the midst of digital transformation, looking for ways to speed their time to market and to deliver new value or services to customers. Start-ups on the other hand are mobile, agile and built solely for the customer, yet they lack the regulatory know-how and customer confidence that large, global banks have. Both have something the other wants, and I anticipate that we’ll witness far greater collaboration, integration and – in some instances – acquisitions happening in the next year.”

It seems that in recent times the cooperation between banks and fintech companies is mostly concentrated on the blockchain technology and its application in the banking services.

The most recent example is today’s announcement of the blockchain specialist Ripple attracting $55 million from several big global banks. It comes shortly after the forming of a consortium of Japanese banks and the Japanese subsidiary of Ripple in August. Santander UK, a branch of the Spanish Banco Santander is also using Ripple’s blockchain technology to test real time payments and money transfers.

Also in August ICAP, BNY Mellon, Deutsche Bank and Banco Santander joined forces with enterprise technology Clearmatics for the further development of the blockchain-based Utility Settlement Coin (USC) concept.

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