Life from the fintech trenches


Nothing in life worth having comes easy, so they say. And well, nothing could ring truer in the world of fintech and banking disruption. Challenges abound, tempers are tested daily and ideas, good and bad, are the ultimate lifeblood of a startup.

In the fintech trenches, where new ideas are being bought to life, everything is an unknown quantity. Failure and success coexist, both equally palpable – electrifying and charging the atmosphere like a thunderstorm. Challenging the banking status-quo is no stroll in the park on a sunny day.

Yet navigating uncharted waters is one of the greatest experiences one can possibly have in life. And the disruption of the banking and financial sector offers many such opportunities to do exactly that.

But before we set sail, the key question to ask ourselves is why our particular brand of disruption is necessary. Just what future are we imagining will come to fruition if we succeed in our endeavours? Because clearly articulating that vision of the future is what will ultimately capture the hearts and minds of those who are the true disrupters – our customers. The vision we sell in the products we create is what will motivate them to do something different. Our customers are ultimately the people that make the fintech cause a reality – it’s not just about us.

The ultimate irony of fintech is that it’s far less about disrupting a bank or an incumbent institution and far more about disrupting the established patterns of thinking each of us have in our heads about the way money, finance and banking should work. As most politicians know, the battlefield of ideas is the hardest to win on, but it is where the fight must be fought.

This week I had coffee with someone new to fintech. They asked me, quite simply, what fintech was. After taking pause, I realised the answer depends a lot on who is doing the answering. For some startups fintech represents a way to develop leaner products that capture a share of the super profits of the banks. For others fintech represents an opportunity to innovate on behalf of banks, yet ultimately partner up with incumbents to reach the market. And for a very select few, fintech strikes at a more philosophical outcome – that is to create a more level economic playing field for the everyday citizen, by democratising access to financial products via technology. It’s about giving people back their lives, plus some.

The last one is far from trivial. Today many argue, the financial system as it stands is showing itself up to be a poor blueprint for equality. Many claim the rising tide of anti-establishment rhetoric as seen in the likes of Trump and Sanders in the US is one outcome of this growing divide in asset allocation and income between the haves and the have-nots.

Governments, fintech, private enterprise and banks have a responsibility to reshape the financial landscape into one that works equally hard for all, not just some. That could mean breaking banking oligopolies and changing regulation to foster the sort of innovation that creates meaningful social change. Not all innovation does this. In fact we will no doubt see more and more innovation that helps the rich get richer. There is nothing inherently wrong with this, so long as it is balanced at the other end of the income spectrum.

But back to the question of what fintech is. Well, only you can answer that. It’s a personal one. But if you take the pulse of your customers and listen to what they really are asking for, or what they would ask for if you were able to open their minds to what is possible then you may achieve something truly special in the history of finance.

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