Yet, we still seem to enjoy the David and Goliath analogy, taking pleasure in the emboldened underdog usurping the power mad incumbent monster. The truth is, thankfully, far from this. The deconstruction of banking and other financial products has led to specialist technologies emerging to address specific user problems, offering their services direct to corporates and banks. It is easy to get left behind; consumer patience is at an all-time low, corporate loyalty and 10-year deals a thing of the past, and the demands of high levels of efficiency, speed and security take priority over all else.

The power of collaboration

If traditional banks want to enhance their own payment platforms, they can no longer afford to view fintech firms as competitors. Private sector players need to work together in new ways to deliver fast, efficient payments solutions. Crucially, businesses should work with payment providers whose strategic goals align with their own. It is only by working together that businesses can optimise the payments process for themselves and their customers. Businesses should ignore this at their peril — they could be risking significant damage to revenue if they do.

Collaboration offers the best of both worlds: the reliability, trust and gravitas of traditional banks — which have a strong network of clients — combined with fintech firms’ competitive technology and critical flexibility. It is in all our interests to come together. We need to generate a robust ecosystem where banks and fintechs partner to build relationships with those in different industries and with diverse offerings.

Regulatory pressure is rife

A report released by McKinsey last year had a couple of striking statistics: in the past three to four years, non-banking providers have been fined $65m for failing to comply with regulation, while the fines incurred by banks amounted to over $1.5bn in the first seven months of 2018 alone. By collaborating with fintechs, traditional banks can benefit from their agility and innovation to alleviate any inevitable regulatory pressure. This will stop them from falling behind and give them a huge advantage when working to keep up with the changing demands of the market and the continually evolving regulatory and political landscape.

Customers are king

With ever-increasing demand from clients, businesses in all industries need to work harder than ever before to meet customer expectations. Consumers are increasingly amenable to new solutions offered by the financial sector. Challengers in the payments space have taken a customer-first approach to financial services. They focus on specific parts of the customer journey to optimise the payment experience and position themselves as ‘financial friends’.

Today’s customers expect a seamless transaction experience. They’re demanding — and rightfully so — tailored, transparent and efficient experiences across every purchasing journey. Fast, trackable payments are now expected by consumers who aren’t afraid to take their business elsewhere if they’re not satisfied. Now, more than ever, it is important for us to utilise the benefits of collaboration by working together rather than in silos. We should all move with the times and, most importantly, serve our customers in the best way possible. It is essential for us to work collaboratively and not against each other if we truly want to see innovation and change rather than a dramatic story about an underdog replacing the monster, only to become the monster itself.