How can banks and FinTechs work together to accelerate innovation?

  • Legal update

    01 March 2024

How can banks and FinTechs work together to accelerate innovation? Desktop Image How can banks and FinTechs work together to accelerate innovation? Mobile Image

We attended the FinTechNZ Hui Taumata 2024 this week, which was once again a worthwhile industry event. Participants in banking and fintech, as well as regulators, gathered to share insights and work towards “thriving together”, which was the theme of this year’s hui. 

One of the group discussions addressed the topic of how banks and FinTechs can work together to accelerate innovation to contribute to a modern, digital economy. This will be critical in allowing the industry to meet its ambitions efficiently and effectively. 

Here are the insights from that discussion.

Making partnerships work

“Partnerships” in this context could mean:

  • a fintech supplying technology capability to a bank (e.g. an app for better customer experience); 
  • a bank finding customers though a fintech (e.g. a service to streamline loan applications);
  • a fintech obtaining customer data held at the bank to provide services to that customer (e.g. a budgeting service); or 
  • some other form of relationship that requires the bank and the fintech to work together. 

For a partnership to be successful, participants in the discussion thought:

  • it should be structured for joint benefit, to achieve a win for each party;
  • it should be aligned to the risk appetite of each party and the risks should be balanced between the parties;
  • the parties should work on having a good relationship;
  • the parties should be transparent with each other about their challenges;
  • each party should recognise what it doesn’t know, be curious about what it can learn from the other party, and be prepared to change; and 
  • the parties should work together to solve problems and continuously improve.

In particular, there were some insights that applied specifically to banks or FinTechs, often coalescing around the tension that FinTechs tend to be lean, agile operations on tight budgets and banks tend to be complex organisations, slower moving and operating to more rigid processes.


What FinTechs could do

What banks could do

Be a solution to an actual problem (not a solution looking for problem).

Let FinTechs get close to the problem to help diagnose a solution.
Be clear about what the benefit is for banks and their customers. Recognise that the pay back may be over a longer period of time or not directly revenue generating.
Understand how decisions are made within the bank and how many layers of approvals will be needed. Be transparent about who needs to be involved and the process – and how long it will take.
Understand the bank’s budget cycle, and how to align to that cycle and get on the roadmap – unbudgeted spend is hard to get agreement on. Get internal alignment on what the priorities of the bank are, and then be transparent about whether/when the idea will fit with those priorities – changing strategy halfway through can be costly for start ups.
Favour open technologies rather than bespoke technologies to achieve efficiency. Consider using fintech products to enhance the bank’s own offerings.
Understand that banks are large organisations, with legacy technology and regulatory obligations – the process to get to market will be longer and harder than you hope. Understand the sector so that the FinTechs do not have to spend precious time getting bank staff up to speed and improve processes so that the bank is better at working at pace.


At MinterEllisonRuddWatts, we help clients develop, negotiate and document their partnership arrangements, and can advise on the adjacent opportunities and challenges that can arise. Please get in touch with one of our experts below if you’d like to discuss your unique business.