WOLF & CO Insights The Future of Fintech Bank Relationships

The Future of Fintech Bank Relationships

The earliest financial technology (FinTech) companies set out to severely disrupt the financial industry and bring the large institutions to their knees. Although there is no denying that FinTech companies have established themselves as key players in the industry, entrepreneurs are finding it more effective to build their companies by partnering with financial institutions as opposed to taking them on. While operating within a highly regulated industry, having access to a bank or credit union’s readily accessible resources could be the advantage you need to successfully create sustainable innovation.

FinTech Companies Partnering with a Bank

A strategic partnership provides both businesses with the opportunity to leverage each other’s strengths. Financial institutions come with capital, an existing brand, infrastructure, and an understanding of tax laws and regulations, while FinTech companies bring the innovativeness and technological expertise needed to create and implement transformation. Entrepreneurs aren’t the only ones realizing the advantages of this partnership. Banks and credit unions are beginning to see technology partnerships as a way to increase their revenue and decrease costs, and so by collaborating, new ideas can thrive and business benefits can be realized.

Where is the proof? According to a recent Business Insider report, 87% of banks partnering with FinTech companies (third-party financial service providers) were able to cut their costs, while 54% of partnerships resulted in increased bank revenue. Considering the amount of money financial institutions spend on their operations and the changes occurring in the industry, a contribution towards a technology partnership may be an inexpensive way for institutions to invest in their future. For instance, as physical branch traffic continues to dwindle, FinTech companies have been empowered to invent easy-to-use technologies that allow banks to continue satisfying and connecting with their existing customers, while reaching new potential customers as well.

How to Partner with a Bank

So where should you start? The first step is to understand your business goals and needs, and what you are looking for in a partner. Keep in mind that not all banks have a desire to invest in new technology, just as your FinTech product may not benefit all institutions. However, through some upfront research and relying on your network, you can start to gain insight into the operations and strategic initiatives of potential partners, and work towards building strategic relationships with them.


Collaborating on technology can be an advantageous way for institutions to invest in their future and for you, as an entrepreneur, to succeed in developing a product that transforms the financial industry. By partnering with a bank or credit union, you can leverage each other’s strengths and focus your efforts on working together to drive the change needed to stay competitive in an ever-changing market. By failing to consider a partnership with a financial institution as an option, your FinTech company could find itself at a disadvantage.