Changing the tide: How Fintech is helping smaller financial firms grow and compete
Until recently the relationship between financial institutions (FIs) and Fintech has been counterproductive and stagnant; seeing each other as direct competitors rather than partners. However, recently there has been a shift in perception. FIs are starting to realize that investment in new technology is critical to maintaining their positions as a player in their respective markets.
Seeing Fintech as an ally, these technological innovations are being used to help improve their leverage, whilst also building better and more efficient experiences for their customers. Smaller FIs have some distinct advantages over larger ones. Smaller Banks have begun to accept the Fintech challenge and believe that with the right partners, who have the best solutions, they'll be able to compete against much larger national and regional FIs. Being smaller in size allows for a more agile approach to business.
With data playing an ever-significant role within community institutions embracing Fintech, the encumbents need to think differently about data. They should look to aggregate customer data, analyze it in real time, and provide front-line employees or channels with information to make the right recommendations for customers at the time of engagement.
Information culled from social media remains a challenge especially for use in making lending decisions. One problem with using social media data, such as what people post on Facebook, is that these habits change over time. Lenders need to be able to make credit decisions based on factors with more longevity.
The data needs to be developed so that it can be turned into actionable insights that profit both the FI and the customer. Digital data analysis and getting the “right” customers (along with creating long-lasting, mutually beneficial relationships), is the focus and one in which smaller FIs are taking advantage of.
It will not be long until the primary industry leaders have caught up, meaning that these smaller businesses need to adopt and innovate once more, continually creating a path for new technology to enter the market, and change these industries.
New and exciting marketing techniques are constantly being developed in order to further progress and keep smaller firms ahead of the curve. Video marketing is central for many Fintechs looking to demonstrate the simplicity and need for their value proposition and to quickly demonstrate key features.
For more information on how 21st Street Creative can help you energize your marketing strategy, please click here.