The theme for this week’s Essential Fintech Reading is related to a recent event hosted by MX called the Fintech Festival. During this content-packed educational event, attendees discussed how technology innovators are changing the financial services landscape. The preeminent thought that attendees left with was that financial institutions and fintech companies can work together to produce better results than either could alone. Some industry leaders agree, as can be seen in this week’s collection of fintech reading.
In a recent article from Forbes, Rohit Arora talks about the challenges that small businesses are facing and how fintech companies are primed to solve those challenges. He says, “A new breed of alternative lenders, such as Lending Club, On Deck, Biz2Credit, Kabbage and recently, Goldman Sachs, have emerged to address the gap between small business needs for financing and the willingness and capacity of banks to serve these needs effectively.”
Digital isn’t something you just invest in. It should also be part of an organizational strategy centered around your customer. Banks are gathering more and more data and have a responsibility to use that data in a way that actually improves the lives of their account holders. Bankingtech.com featured an article this week about this topic stating, “The question is how do we look for things that delight our customers? You need to look at the core-needs of the customer and not necessarily the business you are in. Looking outside the industry, especially those who are ahead, is always a great starting point.”
“Technological innovation is creating new business models and revenue opportunities for FinTech firms globally. As disruption in the banking sector continues, what are the lessons that legacy banking organizations can learn from the new start-ups?” This quote comes from an article written by David Brear on The Financial Brand this week, which features several responses to this thought-provoking question from fintech leaders such as Brett King and Bradley Leimer.
PayPal may not look like a bank or talk like a bank, but several in the industry are worried that’s what it makes it the most appealing option to becoming the “go-to-bank.” With more and more retailers offering PayPal checkout and the tech-savvy millennial depending on the tool for any number of purchases, it’s no wonder that any news around the growth of PayPal is BIG NEWS. Ruth Reader says, “PayPal wants to be the place consumers go for money services, whether that means sending money to the friend who spotted you for dinner or to your family overseas. It also wants to be the go-to app for mobile shopping. In addition to its consumer apps, PayPal has built out a large offering of tools for businesses, such as payment processing apps, and hardware for physical retail outlets as well as online stores.”