Collaborative fintech – setting the record straight

Through my years of working in this industry, collaboration has become a buzzword. It then evolved into ‘collaborative fintech’ – a term so often over-used and under-defined. I have seen first-hand how it can be included in descriptors and content almost as a box-ticking exercise, without the proof to show what it really means.

As I reflect on the ‘new normal’ and how we’ve been adapting our services to meet the needs of new demands for our customers, I wanted to set the record straight on what it really means to be collaborative, and why it’s so important. 

The traditional approach that fintechs have taken is to be disruptive and offer something that is a shift in the existing way of doing things. A one-size-fits-all approach primarily focused on providing solutions to a straightforward yet highly manual process.

For a time, that was enough. But not anymore. It is no longer plausible for vendors to provide solutions that merely do the same thing – but a little quicker. We are operating in a much more complex world of multi-everything – multi-jurisdiction, multi-regulation, and multi-systems. That one-size-fits-all approach will not lead to a growing and resilient organisation.

Take trade reporting as an example. Instead of reporting end-of-day activity, trades must be monitored and reported on throughout the whole lifecycle within very short periods of time. However, the nature of this activity is highly complex, often lacking in standardisation and involving huge volumes of data where there is little, or no margin of error. Due to the sheer number of these controls that must take place, it is imperative that customers can process any instrument type or format, irrespective of how ‘non-standard’ it is.

If systems and teams lack the sophistication to be flexible with these daily complexities, the organisation has a problem. Without a collaborative partner, the danger is that your vendors’ failure to innovate and evolve will ultimately become a burden. Therefore, rather than increasing oversight, reducing errors and leveraging technology to maintain ever decreasing margins, the customers will be faced with having to rely on a ‘band aid’ approach; covering up systematic failings with in-house designed semi-manual processes, leaving firms open to a greater risk of inaccurate data integrity, increased costs and reputational damage.

But how do you know a partner is going to be truly collaborative? How do you look past the marketing talk and see a company that can walk the walk? I have seen a fair few try to get this right, but Gresham succeeds. Our philosophy is to partner with financial institutions and enterprises to design a solution from the ground up that was specifically focused on these highly complex scenarios, allowing our customers to free up more time for higher value, revenue driven activities.

How we deliver collaborative partnership success

• Market understanding: Sometimes it goes beyond how cool your tech looks. Having a tech partner that truly understands your business and the wider market provides a rare confidence and enables solutions to be used across the entire organisation. That knowledge instils trust, more than money can ever buy.
• Flexibility and speed - Gresham has partnered with customers to provide a solution that can not only process the very high volume of transactions but is able to onboard these controls in days rather than weeks. This allows banks to be compliant across their whole organisation and be able to reap the rewards of additional controls sooner, thereby avoiding the risk of censure from the regulators and their own customers.
• Stand shoulder-to-shoulder with customers: That means we recognise that it is not sufficient to just be around when things are going well, we will also be there when they are faced with urgent challenges or issues. Therefore, placing a priority of issue resolution is high on our agenda as we know that failure to react quickly costs time, increased risk, and possible reputational loss.

The primary reason our customers give for moving from a legacy solution to ours is that their existing vendor product had not taken advantage of technology innovations that aligned with the bank’s own philosophy; instead choosing to rest easy on an attitude of “stay with us because we are a big provider”. As a result, the solution delivers an ever-diminishing return.

With the move to home working now putting huge stresses on data integrity and connectivity, the ensuing economic slowdown could contrastingly speed-up demand for automation across the financial services sector.

But it must go beyond that.

By living and breathing the market you operate in daily, combined with a deep-rooted understanding of your business goals, structural complexities and customer demands, the right fintech will streamline ways of doing things and create crucial opportunities for growth and innovation in this uncertain climate.

Get the collaboration right, and the opportunities for growth are endless.