The rise of collaborative banking. As new competitors
emerge at a rapid pace and consumers demand more functionality than ever
before, the industry is struggling with the best path forward. Some have turned
to banking as a service and others to open banking, however, both are
problematic. Instead, many are considering a new route, one that’s mutually
beneficial to all parties involved – collaborative banking.
A move toward self-sovereign identities. As more
consumers embrace digital advancements such as cryptocurrencies and Web3, there
will be an uptick in interest around self-sovereign digital identities. There
is a need for greater control in financial services, granting consumers
stronger authority over who accesses their data and under which conditions.
Expect consumers to lean into self-sovereign identifies moving forward, taking
ownership of their data in new ways
The financial empowerment movement. Just as there is
demand for more consumer control when it comes to financial services data,
there is also a growing insistence for greater flexibility and choice. More
than ever, customers need easier, quicker access to a wider range of financial
education and wellness tools and resources. A ‘one-size-fits-all’ approach will
no longer cut it.
As new competitors emerge at a rapid pace and consumers
demand more functionality than ever before, the industry is struggling with the
best path forward. Some have turned to banking as a service and others to open
banking, however, while both options solve some pain points, they also cause
friction; banking as a service requires fintechs to jump through regulatory
hoops and open banking pits banks and fintechs against each other in
competition for customers’ finances. Instead, many are considering a new route,
one that’s mutually beneficial to all parties involved – collaborative banking.
Collaborative banking is a movement that allows financial
institutions and fintechs to finally join forces, sharing revenue and business
opportunities. In a collaborative banking model, institutions connect with
customer-facing fintechs in a secure, compliant marketplace. The digital rails
connecting the banks and credit unions to the marketplace anonymize and
tokenize all customer data, removing the regulatory risk traditionally
associated with bank-fintech partnership. Collaborative banking allows the
financial institution to put the customer in control, enabling unprecedented
innovation based on customer choice.
A move toward
self-sovereign identities. As more consumers embrace digital advancements such
as cryptocurrencies and Web3, there will be an uptick in interest around
self-sovereign digital identities. There is a need for greater control in
financial services, granting consumers stronger authority over who accesses
their data and under which conditions. Those institutions and fintechs that
embrace secure consumer choice will pave the path forward. Expect consumers to
lean into self-sovereign identifies moving forward, taking ownership of their
data in new ways.
The financial
empowerment movement. Just as there is demand for more consumer control when it
comes to financial services data, there is also a growing insistence for greater
flexibility and choice. More than ever, customers need easier, quicker access
to a wider range of financial education and wellness tools and resources. A
‘one-size-fits-all’ approach will no longer cut it.
Too often, consumers and businesses are forced to choose
between the modern technology they crave and the local institution they know
and trust. Those banks and credit unions that fail to determine how to allow
simpler, risk free access to new technology and services risk losing revenue,
wallet position and loyalty. Those that enable and encourage customer choice
will be well positioned to compete.
Click here for the
original article.