Recently, Minna was invited to the FinTechMatters European FinTech Summit together with Swedbank to talk about learnings from our three-year-old Bank-FinTech partnership. This article highlights what FinTechs should know before partnering with a bank.
In the spring of 2017, Minna Technologies entered a partnership with Swedbank with the goal to develop a subscription management feature integrated inside Swedbank’s mobile banking app. This was our first partnership, and our experience of working with banks was, back then, limited.
Up until this moment, we had developed one of Sweden’s most successful B2C PFM applications and scaled it to 200 000 users. Little did we know how different it would be to integrate the same technologies into a bank. In this article, we will share our learnings from our years working with bank partnerships.
Learning #1 – Learn and adopt
On the surface, there are many similarities between banks and FinTechs. Both develop digital consumer solutions using code, and both are organized in agile teams of developers, product owners, and UX designers.
However, what might not be apparent is the regulatory universe of a bank. For FinTechs aspiring to partner with banks, you will be required to go deep into banking regulations to understand the implications of your technical solution and take the time to comply with a wide range of requirements.
For us, this was a seven-month-long long process to get FSA approval and PCI DSS certification. We also made sure that our way of working was compliant with SOC2 and GDPR regulations – amongst other things.
Learning #2 – Be patient
Doing business with a bank will take time. A bank is a large organization with many stakeholders, thorough procurement processes, and multiple ongoing development projects. Don’t expect your project to be agreed upon and implemented in production faster than 12 months, even if the technical scope itself is easy to use.
Therefore, as a FinTech selling to banks, you need to have a cash runway for at least the next 24 months. You can be assured that banks will consider this before entering a partnership with you.
Learning #3 – Do the work
When you have a partnership with a bank, you will need the support of several decision-makers internally to make things happen. Usually, these people are already busy, and you cannot expect them to do the case for you. Make sure to help them to help you, and be prepared to do the heavy lifting for them.
Learning #4 – Make integration easy
At most banks, development time is a scarce resource, and often subject to internal competition. If your FinTech solution requires lots of development hours for the bank, it is likely to fail.
Preferably, make sure to have well-documented API:s ready. Offering SDK:s or web-based interfaces might also be a great way to save both parties’ valuable time.
Learning #5 – Work on the relationship
Perhaps the most important learning is that the partnership does not stop at product delivery. Remember that your product is most likely competing with other internal projects, and you cannot leave product growth to chance.
Early on, we made sure to invest in partner success. We set up weekly follow-up meetings to monitor product performance, and to plan co-marketing- and co-innovation activities together.