For as long as I can remember, fintech (short for financial technology) has referred to the technology that credit unions and other financial entities employ to do what they do. Too lazy to come up with their own term, millennials have, in the last couple of years, stolen fintech. Now it means technology created by over-achieving millennials to compete with credit unions and other financial entities. The end result is, as I’m sure you’ve heard a million times, market disruption (a term millennials made up to scare you). As my five-year-old granddaughter takes delight in proclaiming, phooey!
I attended the Money20/20 conference for the first time in 2015 and was amazed by the sheer volume of fintech startups hawking their wares. The same was true for the 2016 edition – except for one thing: Though their numbers were again great, their names were all different. Most of the Money20/20 class of 2015 didn’t seem to make it to 2016. Plus, there was a much greater interest by these companies in joining the market – i.e., partnering with credit unions and other financial entities – rather than disrupting it.
These fintechs are starting to figure out that there’s more to it than building a better mousetrap. Unless you have access to the mousetrap-buying public, your new mousetrap doesn’t mean squat. This was confirmed when I recently read that globally, only about 20 percent of current fintechs are still clinging to the market disruption model. The other 80 percent wants to partner with/sell to credit unions and other financial entities. They’ve realized that you have the mousetrap buyers they don’t.
Does this mean you can breathe a deep sigh of relief and go back to business as usual? Hardly. Old-school-definition fintech and millennial fintech are merging to create a whole new technology landscape for your credit union. And I’m proud to say that OmniChannel Communications clients are among those leading this charge. That’s why you’re seeing new core platforms like CUProdigy’s cloud-based system, new online and mobile products like Bankjoy’s omnichannel platform, new mobile payment solutions like DaLand’s STI Mobile Network, and credit unions like CHROME FCU that are embracing new technology at an unprecedented level.
I guarantee that your market will be disrupted by this current wave of technological innovation. It just won’t be the fintech startups doing the disrupting. Nope. This disruption will be brought to you by the same people who’ve always brought you disruption: the folks running other credit unions and banks, at least the ones who are smart enough, wise enough, nimble enough and progressive enough to transform their institutions into the technology-centered financial hubs that today’s consumers demand.
Sit back and relax at your own peril.