Will banking system providers collaborating with fintech start-ups become a trend?

By Alex Hammond | 11 May 2017

Across the industry banks are increasingly generating early connections with start-up fintechs through incubator programmes. Now fintechs are following that trend, instead of acquiring start-ups that could bring some additional benefit their offerings, large banking software providers are partnering with smaller fintechs to offer their clients more solutions to issues they may be experiencing, with easier implementation.

One example of this is the Temenos Market Place, which was launched in 2016. The banking software provider is partnering with an increasing number of fintechs to promote services it does not provide independently to its 2,000 banking clients. Every company that is hosted in the Market Place can be implemented easily in to the Temenos banking platform.

Of course, there are selection criteria that prevent every fintech from joining the Market Place (one benefit of the Market Place Temenos purports is that it has done the research on the start-up market for its clients, cutting out a potentially resource-sapping aspect of the process). And in addition fintechs listed on the Market Place that garner little interest from banks will find their residency in the portfolio under threat (no fintechs have been removed from the Market Place to date as the project was only lunched in 2016, but this is expected to begin in H2 2017).

With banks increasingly concerned that the volume of fintechs in the market and the time and cost of implementation is making quality fintech adoption difficult, it seems inevitable that that larger banking software providers will follow in the footsteps of the banks and Temenos in fostering relationships of this nature with fintech start-ups.

Innovation Jam 2017

The Temenos Market Place had its most public airing at the Temenos Community Forum last month, when regional winners of the Temenos Innovation Jam 2017 presented their tech solutions to a room of major Temeons banking clients who were eager to assess the best products the Market Place had to offer.

“Innovation Jam is about scouring the world to find the most innovative fintech developers and working with them to help bring the benefits to Temenos customers”, said David Arnott, Temenos CEO, emphasising the company’s motivation for promoting the start-ups to its clients.

The ten finalists, offering a broad spectrum of services to banks, were as follows:

PayKey

A payments solution enabling banks’ mobile apps to process transactions through conversations in social apps using a button extension installed in the keyboard, allowing the function to be agnostic to any messenger service.

Finn.ai

An AI customer service tool offering banks the ability to converse with clients in a more conversational way through a variety of different channels including social messenger.

XtremePush

An analytics and engagement platform for retail banks that drives revenue for banks by understanding customers more easily and offering appropriate sales products. Also promotes engagement with customers looking at products digitally through digital reminders and triggers for action in the branch.

Scanovate

An image capturing service which validates documents against photos taken by the user in line with regulation compliance for registrations.  

Sales-ARM

Software to ‘digitise’ the human aspects of a bank’s sales process through better sales recording and relationship management with clients and potential clients. Assists with productivity and accuracy of the sales process.

Easy Equities

Promotes financial inclusion through demystifying equities, and fractionalising shares to permit acquisition at a lower purchasing price. Helps investors make investment choices without intimidation or a required detailed knowledge of the equities acquisition process.

Moroku

Aims to ‘make banking fun’ and allow banks to provide a better quality of service to their customers and increase brand loyalty through a social banking experience. Chore Scout, a game based function, allows parents to teach children the value of money and banking skills through a pocket money payment service.

Capital Preferences

An information acquiring service to determine a customer’s appetite for risk through a decision making process, rather than directly asking them. This data then supports investment recommendations to clients.

EdgeLab

A data platform for investment and risk management professionals, enabling greater insight into the market, and consequently better decision making through the analysis of large volumes of data.

BlueCode

A cash replacement function, connected to a consumer’s bank account, enabling the making of payments directly from bank accounts using mobile. The POS technology enables fast, secure payments, including at cashiers and at vending machines.

PayKey was voted the most innovative and necessary product in the market by the audience, with BlueCode also receiving recognition from a judging panel.

To read bobsguide’s interview with the Temenos Innovation Jam Final winners PayKey, pick up a copy of Payments R[E]volution magazine at Money 2020 Europe next month