Sizing up fintech partners: 4 areas to consider
With the rapid changes in technology, financial institutions need to continually grow and evolve to keep up with the times. But trying to do it all yourself can be a stretch for your budget, resources and timeline.
Finding the right partner that will help you grow is critical to your success – and with the number of options increasing every day, that search can leave your head spinning! Here are five clues you can consider to increase your chances of success.
- Are They Credit Union-Smart?
Early lessons have taught credit unions that taking advantage of the member-centric, personalized approach fintechs offer doesn’t always mean that their partners understand the industry in a way that credit unions take for granted in their daily operations. Just because they present you with a promising solution doesn’t mean they understand the need to get it right without risk to existing member relationships and meeting compliance demands. Finding the right partner with credit union expertise and an understanding of what’s required from a security perspective is a key differentiator in creating and developing solutions to many credit union-specific challenges, from building relationships to selling products.
- Will They Share Your Vision?
When a fintech seems to be the cure-all for member issues and competitive fears that have been plaguing a credit union, that’s the time to step back from technology rapture and look to the future. Credit unions need to stand firm on their vision and how this gleaming tech solution will fit into it. Will they share your vision, or are they just bending their own outlook to make the deal work? When it’s a case of bending rather than buy-in, their own mindset often snaps back to its original position and conflict arises. People, not businesses, sign onto ideas, so credit unions need to reach out, probe, spend time with and ascertain if the fintech management and board are genuinely on the same page – the one in your credit union’s playbook.
- Will Your Members Come First?
Credit unions like fintechs because they can speed up — or enable — their ability to offer more innovative products and services to their members. But as the number of fintechs keeps multiplying, the array of solutions, from proven to promising, can present a confusing array from which to choose. If it’s down to two similar fintech candidates for one opportunity, which to choose? When all else seems equal, the deciding question is which solution, at its core, is better able to help you put your members first.
Credit unions need solutions with a range of tools that are ready to go, helping them increasingly understand their members through user-friendly dashboards, painting a fuller picture of their member base through lifestyle and predictive buying insights, and providing immediate analysis of your success. By partnering with the right provider, your marketing and member service teams should be able to operate at the speed of your members with proactive, not reactive, products and services. You need the steak, not just the sizzle – and that means testing fintech partnerships or acquisitions according to their ability to help them genuinely put your members first.
- Data: The Heart of the Deal
While many fintech-credit union relationships are based on the possibilities of data, they often start out with very different outlooks: the credit union prizes and protects its vault of member information, and the fintech sees it as the fuel that will let its solution really show its stuff.
Credit unions reviewing a fintech partner candidate need to ask themselves if is this a partner that they can trust with their data, according to their rules. The right partner will understand that there is nothing more important to your growth and success than respecting your members and what you know about them. Finding the right partner that appreciates this balance between data security & and data opportunity will offer a faster, more effective route to push that balanced approach forward – without putting your institution at risk.
No matter how exciting the prospects of what a fintech partnership can offer, it is critical that you take the time to ensure you select the best match for your institution. Using these four areas of review as you go through the selection process can help you feel confident that you’ll be positioned for success.
