With new regulations such as EU's Second Payment Services Directive (PSD2) and open architecture framework forcing banks to share their customers' transactional data, regulation may well tip the scales between banks and fintechs for customer loyalty. Concessions must be made on both sides along the way, but in the end the collaborators will be the ones to survive – that's according to an in-depth study released today by Temenos, the software specialist for banking and finance.
The report explores one central theme: 'Symbiosis: Your bank has your trust. Can fintech make you love it?' The report, the fourth in a series conducted for Temenos by the Economist Intelligence Unit (EIU), offers a new twist in the 'tug of love' story of banks and fintechs under changing regulatory and compliance rules.
David Arnott, Chief Executive Officer at Temenos, says: "The struggle between banks and fintechs for customer loyalty is not new, however new regulation and technology change is now driving a shift towards collaboration. Banks with a modern core and an open and flexible architecture will be best placed to seize the advantage and thrive. Temenos is proud to be working closely with banks and fintechs on their digital strategies and championing collaboration via the Temenos MarketPlace"
Renee Friedman, the editor of the report from the Economist Intelligence Unit, adds: "Banks will increasingly have to adapt their culture and digital strategies to their customers' needs if they are to compete, not expect their customers to bend to theirs."
About the survey
The Economist Intelligence Unit surveyed 200 senior retail banking executives about regulatory, customer, security and technology influences on the industry up to the year 2020.
In addition, in-depth interviews were conducted with 36 senior executives from banks of all sizes, start-ups, venture capitalists and mutual fund managers.
The key findings show:
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