Where are bank-fintech relationships headed?

Banks and fintechs are like the financial services' version of ‘The Odd Couple.’ Fintechs and neobanks are going through a rough patch, which, for some, will be fatal. The banking industry continues to go through seismic changes, with worse to come. At the same time, many are still plugging away at digital transformation. Partnerships may be the best bet for both going forward — but a twist called 'community fintechs' could be a spoiler. Research by Cornerstone's Ron Shevlin and commentary from banking executives illustrates how times are changing (again).

Fintechs and traditional financial institutions have had an odd relationship over the past decade or so.

Many fintechs started out declaring their intent to replace banks, then morphed into vendors eager to offer their tech innovations to those very same rivals. Other fintechs are customers — or partners, depending on your viewpoint — of the traditional banks that have made a business of banking as a service.

Overlaying these relationships is an economy that is becoming more challenging for all. That’s sure to set new dynamics in motion, especially with funding issues expected to grow acute for many fintechs this year.

Ron Shevlin, chief research officer at Cornerstone Advisors and author of its annual “What’s Going On In Banking” study, says both sides have fresh thinking to do about their vision for the future.


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