FinTech Connect: Covid increases project implementation speed

By Sunniva Kolostyak

Covid-19 has not increased the appetite for innovation, but accelerated medium-term projects, according to a panel at the FinTech Connect conference.

The panel ‘Build, Buy or Partner? What is the best route to FinTech survival’, chaired by Adam Davis, Head of Delivery at 11:FS, discussed the effect the pandemic has had on financial services, as well as the different paths for banks and FinTechs looking to optimise their businesses.

Zemfira Khisaeva, Head of Technology and Enterprise Strategy at Scotiabank, stated that over the past months, it is not the appetite for partnerships and innovation that has changed, but the speed and focus.

“We’ve seen an acceleration of digital, we’ve seen that there was a lot of opportunities that we had in the pipeline of the medium-term type that has now just been accelerated significantly,” she said – noting projects within digital onboarding, fraud, collection, and a better understanding of personnel and customers.

“We’ll see that probably, the momentum will keep on growing and we will keep on doing more and more important things, like during the past few months.”

Randy McFarlane, Head of Strategic Partnerships and Alliances at Bottomline, agreed that the appetite for partnerships between banks and FinTechs was on the up before March this year, but the Coronavirus meant institutions had no choice but to change.

This is equally true for FinTechs, he said; Bottomline has not just been looking at strategic partnerships for how to go to market, it has also been exploring partnerships with other tech firms.

“We are no different, actually, to some of the financial institutions that we work with. We are looking at how we can drive our innovation, but also balance that with also reducing costs, etc.,” McFarlane said.

“There are some FinTech players out there that do some really cool things, and actually, does it make sense that we partner with them so that we can enhance our own value proposition that we then take to either our partner community or our customers, whilst reducing costs at the same time.”

Also speaking at the FinTech Connect panel, Vicky Zhang, Innovation Lead at Enterprise Solutions at RBS Group, added that for larger universal banks, a hybrid approach to technology innovation is essential, working across partnerships, acquisitions and building solutions in-house.

“A hybrid model means you’re sharing the risk. In the areas where you want quicker access to a capability, a partnership is potentially the most straightforward way in terms of risk, cost, reputation, customer base, distribution, everything. But in terms of build, I think it gives the bank its own control and a more integrated solution, and, in turn, a seamless customer experience.”

Mohamad Zaraket, Director EMEA Digital Lead at BNY Mellon, agrees that a hybrid model is the best approach, as each opportunity to buy, build or partner must be assessed on a case-by-case basis.

“If you think there’s something very strategic and you need to have full control, maybe you already have the budget and you think you’re going to bring it to market faster and cheaper: go for it.”

“Of course, in the recent years, there has been that increase on the partnering side, and one driver is because we are in need of talent,” he added.

Jane Loginova, Co-Founder of Radar Payments, added that there is increased pressure on FinTechs from investors to actually deliver, rather than just being a disruptor.

“The questions that now come to the team is not just about ‘what is this great, cool feature you’re doing that nobody else is?’ but ‘how are you going to bring it to market?’, ‘how are you going to sell?’, ‘how are you going to penetrate?’,” she said.

“Now is the time for them to show their value, show that technology that they came up with, how does it actually work,” Loginova added.