All The Fintech - 9.20.18 - Banks + Fintech
|Charley Ma||Sep 21, 2018|
Hi everyone! It’s been an extremely hectic last month and I fully expect that to continue since (drumroll please…) I just moved to NYC! Excited to continue to learn more about the fintech scene in NYC as well as meet a bunch of people, please shoot me an email if you would be down to grab a coffee :).
I often get asked the question -“what’s been the most interesting recent development in fintech”. Recently, my answer has actually been banks! When I was in the payments strategy group a few years ago at JPMorgan, I managed to build my niche in the organization by spending most of my time researching emerging products. Companies like Venmo, Robinhood, Coinbase, etc were barely on anyone’s radar, so I was allowed to drive a more “niche” strategy vertical. Over time, I became increasingly frustrated with the lack of pace in regards to execution - the vast majority of product initiatives continued to live in a deck on a shelf vs being tested in the hands of consumers.
That being said, over the past 3-4 years there’s been an explosion of interest into fintech from large financial institutions (don’t get me started about blockchain…). During 2015-2017 it seemed as though every bank was announcing some sort of fintech (or blockchain) strategy group, followed by a strategic investment arm that was also typically launched in conjunction with a “new” digital product innovation group. A lot of buzz, a few partnerships + acquisitions, but no real products.
This year, this has started to shift with several of the largest banks finally launching fintech products: Chase’s Finn (which I just recently signed up for…and that process is a whole other post), Citi's new mobile app , Ally's Invest, etc. Large financial institutions have slowly been making the hard transition from just selling financial services to offering digital products.
I associate brands such as Chime, Robinhood and Coinbase as companies that ship new digital products that happen to deliver financial services. On the other hand, I associate brands such as Chase, Wells Fargo, and Citi as financial services institutions that view digital product as a channel. One huge advantage that fintech startups have over large FI’s is the fact that the vast majority of successful fintechs were product driven from the very beginning. The product is the business rather than just being a means to an end. It’ll be interesting to see if the banks will be able to make switch effectively or if they even need to…