Fintechs vs. banks? Time to clear up the competition myth

By Oleksandr Kryshtal, Raiffeisen Bank Aval |

Fintech primarily refers to innovations in the financial sector. Such innovations may include a new customer experience, a completely new product or modernization of cross-banking technology. Fintech has the ability to bring banking into the modern age offering advanced solutions to the financial services world. However, some time ago, the opinion that fintech may pose a competitive threat to traditional banks has been established and nurtured a fear that it could even outgrow banking completely. But why should there be competition, where there is so much room for mutual cooperation?

Oleksandr Kryshtal, Raiffeisen Bank Aval

What I see every day is that fintechs and banks are predominantly interested in the co-development of products and services. While the bank acts as a provider of a customer base and banking expertise alongside a legal and compliance structure, the fintech company contributes its innovations and user experience. The rationale for collaboration is the ability to bring the strengths of both banks and fintech companies together.

The Ukrainian fintech market started its development in the early 2000s with the appearance of payment processors. Nowadays, the payments market is overcrowded, and brings out a lot of possibilities and innovative solutions. Meanwhile, other areas (such as lending, consulting) are still open for exploration. A number of fintechs will continue to grow. Among the main spheres of their development are artificial intelligence, machine learning and big data.

Raiffeisen Bank Aval has always been open to innovation and partnerships with fintechs. We have many successful examples of fruitful cooperation with fintech companies in the areas of payments aggregation, big data processing and others.

What cannot be denied is that today’s competitive environment requires a full focus on customer experience. This can only be achieved if our bank acts fast and agile. With this purpose, we have created our own R&D center, the Raiffeisen Digital Hub, which is concentrated on customer-centric solutions like mobile or internet banking. In our Digital Hub, we have a lot of joint projects with small and large fintechs. Our ongoing projects focus on contactless payments, digital acquisition and big data. All the mentioned directions assume the very active involvement of fintechs at certain stages of the process.

In the nearest future, we will see an increasing interest in remote identification, personal financial advisory, cross border transfers and much more. And by following the path of collaborating with those who bring innovation, I am sure that Raiffeisen Bank Aval will be actively involved in these spheres.

Oleksandr Kryshtal is Head of Digital Banking Division at Raiffeisen Bank Aval in Ukraine.

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