Payments and Banking arena is in for a storm as they are undergoing a deluge of rapid technological developments as well as corresponding entry of latest FinTech Players into the Finance and Banking Arena thus, forcing them to adapt and as well as navigating to a dynamic landscape.
According to Michael Bellacosa, Head of Global Payments Product Management, Treasury Services, BNY Mellon, shares his valuable inputs on how the Banking arena is swiftly advancing alongside fintech and digitization as well as how entire banking, financial institutions are in the realm of delivering the client-centric, transformative payment initiatives.
With the emergence of the latest technological capabilities and a FinTech surge bursting into banking, the financial landscape is presenting newer challenges like having an all-new ball game for Banking and financial institutions, start-up Neo Banks concept, etc bringing them to get accustomed to rapid-paced digital and a competitive market.
Definitely there is a great degree of uncertainty prevailing across the Banking and Financial arena wherein should they completely discard the age-old traditional cash-backed transactional bank or financial methodology or a complete digitized FinTech owned platform for transactions that comes with its own set of merits and demerits. At present, there is a ‘Wait and watchful action’ approach taken by most Banks and Financial Institutions that also include Investment Firms, Asset, and Wealth Management Firms, Loan management firms, etc.
The FinTech has definitely proved beneficial as they have introduced a set of latest technologies and possibilities that is inclusive of : –
- Opportunity for the majority of the banks to address the historic challenges of their payment legacy systems.
- Offering a complete customer as well as Corporate centric innovative, unique, swifter and latest modernized solutions.
- As well as an exploration of and optimum leveraging and utilization of disruptive emerging technologies that have a higher potential of enhancing transactional and enhancing payment centered swifter approach.
- Tapping more into vibrant fintech scene, including venture capital-style investment and incubator/accelerator programs.
This close collaboration with the FinTech community has not only enabled banks to become involved in developments and understand how fintech could impact the industry but has also helped to affirm banks’ role in delivering the future of payments.
Indeed, the value of bank-fintech partnerships is very much reciprocal, with FinTech benefiting from banks’ existing, extensive pool of clients, their established trust and security with regard to cash and transactions, as well as their ingrained knowledge of the practicalities of functioning payment systems and industry requirements regarding regulation and risk mitigation – areas in which FinTech has very limited experience.