# Reorganising for the Age of Collaboration Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2016-09-28 Category: FINANCE Category URL: https://financedigest.com/category/finance Meta Title: Future of Fintech: Collaboration vs. Disruption Meta Description: Discover the unprecedented $25bn investment in global fintech market and the rise of collaborative models between fintech start-ups and traditional lenders. URL: https://financedigest.com/reorganising-for-the-age-of-collaborationhtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/sh8-5247-826-1736844481963-compressed.jpg) **Graham Donald**, Managing Director of Equiniti Pancredit Over the past two years an unprecedented $25bn has been pumped into the global fintech market and it looks like this is just the beginning. According to a recent Accenture report, Q1 2016 saw a 67 per cent year-on-year increase in global fintech investment. That’s a $5.3bn injection of funds over just three short months. [\[1\]](#_ftn1) Such vast sums are [creating an environment where start-ups can launch](https://www.financedigest.com/veritone-launches-marvel-ai-a-complete-end-to-end-voice-as-a-service-solution-to-create-and-monetise-hyper-realistic-synthetic-voice-content-at-commercial-scale.html "Veritone Launches MARVEL.ai, a Complete End-to-End Voice-as-a-Service Solution, to Create and Monetise Hyper-Realistic Synthetic Voice Content at Commercial Scale"), fail, rethink and re-engage, all in a matter of months. For long-established financial institutions, most of which are used to a conservative and slow moving [services market](https://www.financedigest.com/condition-monitoring-service-market-buoyant-with-flourishing-power-generation-industry-adoption-exhibits-a-notable-decline-amid-covid-19-pandemic-fmi.html "Condition Monitoring Service Market Buoyant with Flourishing Power Generation Industry; Adoption Exhibits a Notable Decline Amid COVID-19 Pandemic: FMI"), this sort of behaviour isn’t just unusual, it’s borderline bizarre. For the new breed of start-ups, however, every stone is ripe for turning from the [way](https://www.financedigest.com/6-ways-to-finance-your-dream-vacation.html "6 Ways to Finance Your Dream Vacation") customers consume financial services to the back-end systems that move money around the world. Two years ago, the market had an adversarial feel. ‘Disruption’ was the industry watchword and the start-ups were on the offensive. How much business could be taken from the [traditional banks](https://www.financedigest.com/digital-banking-traditional-banks-vs-fintech-providers.html "Digital banking: Traditional banks vs. fintech providers") and lenders? Could the new groundswell of start-ups [signal the end](https://www.financedigest.com/does-softpos-signal-the-end-of-payment-hardware-as-we-know-it.html "Does SoftPOS signal the end of payment hardware as we know it?") of traditional banks entirely? Since then, things have settled a little, resulting in a new dynamic. The number of start-ups adopting a collaborative model is increasing. While a high proportion of [fintech companies continue to compete directly with traditional lenders, Accenture reckons that 44 per cent of global fintech investment](https://www.financedigest.com/investing-in-fintech-trends-how-to-get-started.html "Investing in Fintech Trends: How to Get Started") is now going to start-ups that position themselves as partners, not competitors, of established players. This is good news, both for the [industry and the customer](https://www.financedigest.com/listen-care-share-ofwats-latest-report-on-the-water-industrys-handling-of-customers-during-the-pandemic.html "Listen, Care, Share: Ofwat’s latest report on the water industry’s handling of customers during the pandemic"). Enabling larger [players to deploy digital services](https://www.financedigest.com/high-energy-shockwave-therapy-units-market-end-user-demand-by-types-regions-top-players-service-provides-regional-outlook-and-forecast-to-2028.html "High Energy Shockwave Therapy Units Market End-User Demand by Types, Regions, Top Players, Service Provides, Regional Outlook and Forecast to 2028") to their customers will guard against service fragmentation which, if left unchecked, could result in consumers’ financial data strewn across different providers making it difficult to manage coherently. Through collaboration, traditional lenders also get the [opportunity to benefit from the agility and innovation](https://www.financedigest.com/luggage-market-development-innovation-opportunities-and-growth.html "Luggage Market Development, Innovation, Opportunities And Growth") that has, to date, been a defining characteristic of the fintech industry. The start-ups [gain a steady](https://www.financedigest.com/dollar-steadies-near-16-week-low-yuan-set-for-biggest-weekly-gain-since-2005.html "Dollar steadies near 16-week low, yuan set for biggest weekly gain since 2005") and reliable revenue stream from the bigger players, together with a viable exit strategy (via trade sale). Moreover, the raft of new digital services will be subject to close quality control and governed by the closely regulated environment under which the big [banks and lenders operate](https://www.financedigest.com/stellantis-reshuffles-european-financing-operations-through-new-jvs-with-banks.html "Stellantis reshuffles European financing operations through new JVs with banks"). To take full advantage, however, the traditional [players need to reorganise internally since partnerships bring](https://www.financedigest.com/impact-com-announces-partnerships-experience-event-ipx-bringing-together-all-players-in-the-partnership-economy-and-featuring-special-guest-trevor-noah.html "impact.com Announces Partnerships Experience Event, iPX, Bringing Together All Players in the Partnership Economy and Featuring Special Guest Trevor Noah") their own sets of challenges. The [market is crowded and start-ups come](https://www.financedigest.com/mena-infant-milk-formula-market-to-record-exponential-compound-annual-growth-rate-in-the-coming-years.html "Mena Infant Milk Formula Market to Record Exponential Compound Annual Growth Rate in the Coming Years") and go. How can a [bank be sure to pick](https://www.financedigest.com/hsbc-ups-price-targets-on-greek-banks-with-eurobank-piraeus-top-picks.html "HSBC ups price targets on Greek banks, with Eurobank, Piraeus top picks") a winner? What’s more, most fintech companies have a very specific product or [service focus](https://www.financedigest.com/three-areas-of-focus-for-financial-service-cisos-in-2022.html "Three areas of focus for Financial Service CISOs in 2022"). How many partners will a bank need to establish before it can [offer a comprehensive suite of cutting-edge digital](https://www.financedigest.com/digitization-to-offer-stewardship-to-the-pulmonary-hemosiderosis-market.html "Digitization to offer stewardship to the Pulmonary Hemosiderosis Market") services? Herein lies a big opportunity for next generation financial outsourcers, particularly those who, through acquisition, are able to offer a suite of [digital services that can be wrapped up and delivered to a bank](https://www.financedigest.com/major-myths-and-questions-holding-banking-and-financial-services-back-from-full-digital-id-adoption.html "Major myths and questions holding banking and financial services back from full digital ID adoption") through a single managed services contract. Such a proposition requires some clout, however. A [bank will be seeking to offload as large a part of their business](https://www.financedigest.com/being-nimble-and-responsive-in-banking-and-business-has-arrived-thanks-to-accounting-automation-technologies.html "Being Nimble and Responsive in Banking and Business Has Arrived, Thanks to Accounting Automation Technologies") as possible through such a partnership, meaning that the outsourcer must have the technologies and services ‘ready to go’, together with the regulatory compliance, the specialist processes needed to administer the services and enough skilled staff to support the service rollout as they scale up. Those capable of serving this [need should be making themselves known to banks](https://www.financedigest.com/could-the-npa-be-the-catalyst-banks-need-to-transform-their-payment-networks.html "Could the NPA be the catalyst banks need to transform their payment networks?"), now. The fintech [market is developing at a ferocious pace and it is unclear how long this current](https://www.financedigest.com/stability-test-chamber-market-2019-scope-of-current-and-future-industry-2027.html "Stability Test Chamber Market 2019 | Scope of Current and Future Industry 2027") air of collaboration will last. What we can be sure of, however, is that things will change again. The [digital market](https://www.financedigest.com/digitized-overhaul-to-drive-the-pulmonary-fibrosis-treatment-market.html "Digitized overhaul to drive the Pulmonary Fibrosis Treatment Market") is upon us and it is now down to us all to keep pace. [\[1\]](#_ftnref1) [https://newsroom.accenture.com/news/global-fintech-investment-growth-continues-in-2016-driven-by-europe-and-asia-accenture-study-finds.htm](https://newsroom.accenture.com/news/global-fintech-investment-growth-continues-in-2016-driven-by-europe-and-asia-accenture-study-finds.htm) --- This blog is powered by Superblog. 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