Embedded Briefing: Banks’ role in the BaaS ecosystem
- The next stage of development in financial services requires fintechs and banks working together – to learn from each other, and collaborate to create next-gen products.
- Also, as countries around the world find themselves at different stages of open banking regulation, the UK, EU and India lead the global race.
Fintech is today a powerhouse of an industry – globally, it is estimated to be worth $26.5 trillion, while also contributing the highest number of unicorns (roughly 1 in 5) across industries. The space has reached a level of maturity where experts see its convergence with the banking industry coming to the forefront.
As much as innovation has spearheaded the industry’s growth, the next stage of development in financial services requires fintechs and banks working together – to learn from each other, and collaborate to create next-gen products.
While the value fintechs can bring to bank-fintech associations – with engaging customer experiences, robust distribution channels, and strong brand appeals – is apparent, there is less clarity over the roles banks can play. How a bank can bring value in the BaaS ecosystem is heavily dependent on what they’re good at, their unique model and infrastructure buildout.
“The approach Piermont takes is to foster a deeper relationship with the fintech companies we serve,” Wendy Cai-Lee, CEO and founder at Piermont Bank, told Tearsheet. “We focus on building a partnership with each fintech we onboard and providing value in a few key areas including risk management, operational excellence, and product development.”
This content is available exclusively to Tearsheet Outlier members.
Missing out? Subscribe today and you’ll receive unlimited access to all Tearsheet content, original research, exclusive webinars and events, member-only newsletters from Tearsheet editors and reporters and much more. Join Outlier now — only $49/mo. Already an Outlier member? Sign in to your account