It’s easy to push a narrative of fintech startups versus big traditional banks, but the subtler reality is that, in addition to competing on numerous fronts, partnerships are being formed across the board. The latest such move is for Tink, the Swedish-based banking platform that raised € 56 million in new funding in February, a partner of British bank NatWest.
The deal gives NatWest access to Tink’s Personal Finance Management (PFM) and “Data Enrichment” products, which will be integrated into NatWest’s flagship mobile banking application. This will allow NatWest to enhance its mobile banking offering by providing customers with personalized information about their finances based on transaction history. Features built with Tink technology are planned to roll out in Q4 2019.
The big picture is that by partnering with Tink, NatWest aims to meet the highest customer expectations for digital financial services. Without a doubt, a host of challenging fintech startups and banks have significantly increased the UX and feature bar in the UK and across Europe, not just through high-quality mobile apps and better use of data. data, while incumbent banks have been trying to catch up.
“Historically, banks have tried to build everything on their own, but now we’re seeing a big shift where they want to partner with the best to drive development, quickly launch new features, and remain competitive,” the co-founder and CEO of Tink, Daniel Kjellén.
“Today more and more banks are choosing to take advantage of the external building blocks that are available to them and add the internal uniqueness of that. We have seen the same development when it comes to hosting: banks are now choosing cloud-based solutions like AWS over local solutions. “
To that end, although it was originally launched in Sweden in 2013 as a consumer-facing financial app with bank account aggregation at its heart, Tink has since repositioned its offering to provide the same underlying technology and more to banks and others. financial service providers.
Through various APIs, Tink provides four pillars of technology: “Account Aggregation”, “Payment Initiation”, “Personal Finance Management” and “Data Enrichment”. These can be used by third parties to deploy their own standalone applications or integrate into existing banking. Applications
Along with NatWest, Tink has partnerships with several other banks, including Klarna, BNP Paribas Fortis, ABN AMRO, SEB, and Nordea.
Meanwhile, PFM (personal finance management) functionality in one form or another can now be found in numerous fintech banking apps and chatbots, and I told Kjellén that a PFM feature is now a commodity. He pushes back.
“It is true that customer expectations for digital banking services are increasing and incentivizing incumbents to develop their PFM tools at a faster rate than before,” he says. “But the future where PFM is completely data-driven and where product recommendations, advice and decisions can be put on automatic pilot is still a long way from being a commodity.”
“The more advanced players are now building products that… turn their PFM applications from read-only to data-actionable. It is this combination of functionality that will change the game for the industry. “