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Your 2022 Fintech To-Do List

fintech to do list - employees looking at graphs

Seismic changes in community banking have happened over the past couple of years. It doesn’t seem to be slowing down, either. We don’t have a crystal ball or mind-reading skills, but we do know fintech and the banking industry, and we definitely know what it takes for financial institutions to compete (and win.)

With that in mind, Joel Legg, our VP of Technology, shares the top four focus investment areas for banks this year.

Core Providers are moving toward open banking 

“It has been a closed ecosystem for years now and it is a pay-to-play game,” Joel says. Not many community banks have had the ability to innovate at the same pace as the big bankers. But that’s changing. 

Community banks need access to digital banking solutions to compete in today’s market, but they don’t want to abandon their core providers to get it. Core providers understand that. Fortunately, Joel says, there’s a win-win solution. 

“The core providers are trying to make it more of an open ecosystem where fintechs can come in and build or provide solutions integrated to the core to help community banks out. It is going to be one of the bigger game changers, in my opinion, in the next few years. Those that can open their ecosystem will do better in the near term and long term.”

By making it easier to access the latest fintech without leaving the stability of their core providers, open banking will make digital transformation more accessible for community banks. 

Community banks are saving time and money with automation 

For too many community banks, their lending processes are not only manual, but redundant. 

“We met with a bank a couple of days ago and they walked us through their entire lending process. I think the lending officer entered the applicant’s name twenty-five times,” Joel says. “She used Excel multiple times – as she exits out of the system, goes back, pulls that information. Really what they’re looking for is a way to streamline the entire application flow, hook it directly onto the core and make that a streamlined process. 

“A lot of the problem with automation was the cost around it,” Joel says. “The cost of changing that Excel spreadsheet isn’t worth another twenty or forty grand a year for a system that’s provided by the core, so community banks just continue the process because it’s working. That’s where Accrue comes in because we are cost-efficient. We offer an entire automation solution, including the necessary support for it.”

Besides driving operational efficiency and lowering costs, automation has another benefit worth considering. When manual tasks are automated, bank staff has more time to dedicate to client relationships, product development, and customer service. 

Everybody’s watching the blockchain

More than two-thirds of all financial services industry respondents to Deloitte’s global blockchain survey believe digital assets will dominate or replace currency within the next decade. 

Blockchain technology will touch all fronts of this digital frontier, from funding and payments to deposits. We’ve already seen the rise of crypto firms like this one – and they won’t be the last.

Although it’s widely known for its ability to boost data security and identity protection, it allows community banks to settle transactions instantaneously, which is appealing to both banks and consumers.

Joel says, “A lot of blockchain will be used in the payments arena around cryptocurrency and getting around the exorbitant fees from the larger credit card companies. It will continue to grow and evolve as regulations are developed.”

Innovations are happening with embedded banking 

In the past couple of years, embedded banking has begun quietly transforming a number of consumer experiences – from round-up savings and investment startup Acorns to furniture-and-meatball magnet Ikea

Embedded banking allows a clever bank to integrate their financial services into a non-financial platform. For a savvy community bank with the right fintech partner, this offers a world of innovative opportunities to streamline, surprise, and delight consumers – and add revenue streams.

“It brings digital banking activities to where you currently do business,” says Joel. “So if you’re in QuickBooks, it’s being able to apply for a loan or open an account directly from QuickBooks rather than having to open an account in a separate application.”

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In a quick-moving, ever-evolving industry, staying on top of what’s new can help your business compete. When you’re ready to level up, Core10 is ready to help. Find out what a Core10 partnership could do for your business. Learn more about Core10 or give us a call!

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