Business of Fintech, Partner

Better together: The right partnerships in digital transformation matter

  • Optimizing the customer journey is king. Often, that means delivering digital products that require the fintechs and FIs to rely on technology partners.
  • The right partner will help a fintech or FI solve major challenges, like collecting sensitive information from hesitant users while preventing identity fraud.
close

Email a Friend

Better together: The right partnerships in digital transformation matter

Today, more than ever before, the financial industry is faced with an important undertaking: digital transformation. From improving the flow of onboarding new clients and accessing financial data, to following regulatory guidelines, securing backend systems, and preventing fraud, financial institutions and fintechs are tasked with leveraging technology in a way that puts both consumers and security first.

Financial data is at the heart of financial services. And that puts aggregating and understanding it at the heart of the consumer-centric digital transformation for financial institutions and fintechs. 

In our recent talk with Kevin Hughes, senior manager of Fiserv’s AllData Aggregation suite, we spoke about how the digital era has transformed the value and usability of financial data to better serve users. The mortgage application process, for one, has traditionally been full of friction and uncertainty for both lenders and borrowers. Only a few years ago, applying for a mortgage meant uploading and logging a heap of documents and statements. 

Today, an mortgage applicant at Fannie Mae can simply provide her personal and account information, and leave it up for Fiserv to then “use the technology behind the scenes to connect to that institution using aggregation and pull in account and transaction information as well as balances and statements for the past two or three years.” And it all happens in the span of that one session.

Optimizing the customer journey is top of mind for financial institutions and fintechs undertaking digital transformation. And a customer journey always begins with ID verification.

Save is a service provider that integrates investment technology into everyday banking products like savings accounts, checking accounts, debit, and credit cards. Fully automated, Save’s users are able to increase earnings from market returns by simply using their money as they normally would. This product is especially helpful for younger millennial and Gen Z consumers, who have not yet put away a great deal of savings. 

But delivering digital products comes with challenges. 

In our recent podcast, Save’s President & COO Adam Watts explained that a comprehensive online financial experience starts -- and can also end -- with onboarding. The verification involved in the signup process requires sufficient AML and KYC, and as a result, often becomes a major source of friction. This is especially true for older generations who are typically less keen on providing sensitive information online. This friction can be costly, and can cut customer journeys before they’ve hardly begun. 

At the same time, firms are also juggling vulnerability to major security threats. Watts estimates that fraud has increased around 150% since the onset of the pandemic, and admits that Save is in constant battle against fraudsters and their associated costs. 

To solve for the twofold challenge of creating a seamless, secure ID verification process, Save relies on Fiserv’s VerifyNow, which helps authenticate users easily and in compliance with all regulatory standards. 

Paul Diegelman, Aggregation & Verification VP at Fiserv, explained that VerifyNow “allows users, through a fairly straightforward UX, to provide the information that they are comfortable with providing.” Fiserv then does the work of collecting the remaining data needed to complete the onboarding journey.

In the era of digital transformation where data is king, fintechs and financial institutions should make sure they partner with the right provider that can provide real-time accurate data to meet theirs and their users’ specific needs. Hughes recommends FIs and fintechs consider partnerships with four factors in mind: reliability, adaptability, security, and the changing regulatory environment. To learn more, head on over to his article here.

0 comments on “Better together: The right partnerships in digital transformation matter”

Outlier OpinionsMakers

Banking, Partner

For US banks, the question of modernization is no longer when, but how

  • 90% of North American banks consider technology to be the biggest trend impacting their industry.
  • But modernization is easier said than done. Payments is a good place for banks to start.
Nelly Rezny, Temenos | November 30, 2023
Keeping the bad guys out, Partner

Why ‘know your business’ is critical for FIs everywhere — and how banks, fintechs, and marketplaces can benefit from emerging solutions

  • Bad actors are continuing to improve their technology and tactics to commit financial fraud.
  • FIs can use Know Your Business (KYB) compliance as a competitive advantage if they're willing to invest in business verification data.
Enigma | November 29, 2023
Partner

PayPal & Paxos execs talk to the future of finance via stablecoins

  • The shift towards digital currency adoption led to the the recent launch of PayPal USD, or “PYUSD,” marking a seminal moment in the finance industry’s evolution.
  • On December 6th, executives from PayPal and Paxos will discuss the rise of stablecoins, the growth of PayPal USD, and the future of money.
Paxos | November 28, 2023
Artificial Intelligence, Partner

The Future Unveiled: Generative AI’s influence on financial institutions, from Customer Care to Fraud Prevention

  • In finance, generative AI transforms customer service with advanced conversational AI and NLP, boosting satisfaction and revenues.
  • Additionally, it impacts fraud detection by crafting synthetic data, cutting false positives and improving detection rates significantly.
Jacqueline White, i2c | November 16, 2023
Artificial Intelligence, Partner, Payments

The AI Effect of the future of payments

  • Technical innovations like generative AI can push the bounds of global commerce
  • Visa’s new AI Advisory Practice will aid businesses in the payments sector to unlock the potential of artificial intelligence (AI) and utilize generative AI (Gen AI)
Visa | November 09, 2023
More Articles