Today, consumers choose brands, products and services primarily based on the quality of the user experience they provide. When it comes to financial institutions (FI’s), no longer do consumers select them based on the quality of service between FI’s, but rather benchmark them based on best-in-class user experiences they’ve had themselves, regardless of the industry.
As a result, the role of an FI has shifted drastically. Historically they have simply expected their customers to accept the status quo, there are now many more choices, and consumers are increasingly looking at these alternatives.
Alternative financial solution providers are focusing on the user experience and prioritizing this as their major market differentiator allowing them to compete directly against FI’s, threatening their traditional role as the sole provider of users’ financial service needs.
Luckily for financial institutions, many of these alternative solution providers can enable and facilitate, through partnership, the level of customer service and customization that banks require.
While it seems to be a natural collaboration, it is far from a simple one: For such arrangements to succeed, they cannot be mere vender/supplier relationship, but rather a true partnership. Both sides must share the win-win mentality in order to fully maximize value for both entities.
This can be achieved but requires many steps toward ultimately delivering a seamless experience for the end user. It is crucial that both parties ensure they create a long-term strategy in order to plan for scaling the partnership and expanding its scope. Any partnership’s success will depend on building in contingencies for changes in the industry, allowances for each partner organization’s changing needs, and even plans for unforeseen demand.
Another critical element to a successful partnership involves measurement, specifically ensuring data driven metrics and monitoring are in place to accurately evaluate performance against the success criteria. By monitoring and closely watching performance, businesses can ensure corrections are made in a timely manner, with decisions made based on facts rather than opinion.
Finally, there must be mutual acknowledgement that both parties can learn from one-another: The fintech has the specialized knowledge and technological know-how to build upon the existing platform to provide greater personalization and functionality, while the FI has the expertise in operations and scale.
One major area of opportunity for fintech and FI partnerships exists in the complex world of cross border payments. With the growing need for instant international payments, it is becoming increasingly apparent that a pivotal moment has arisen for FI’s and fintech’s to partner in a model where both parties leverage their strengths to bring solutions to market. In an economy where convenience is not only expected, but demanded, the banks who take the lead on cross border payments will be the ones who attract, and retain, the most customers.
At Bucky Payments, our focus is on relieving the pain points that exist in cross border payments industry. We partner with banks and financial institutions to enable their customers to send and receive money instantly between bank accounts, 24×7, 365 days a year.
Banks will need to implement and work with companies like Buckzy to utilize these new technologies if they hope to be viewed as a preferred provider of cross border payments servicers. If they don’t adapt, they risk being eclipsed by financial technology companies working to do the same.
FI’s can no longer simply handle transactions: Their new role is to meet the demands of their consumers by providing options, customization and a better user experience. Their top priority now must be attracting, and maintaining, happy customers if they want to stay relevant.