fintech digest
Bank-Fintech Partnerships, Narrow Banking's Redefining Role & More
Research Team
12 January 2024
United we thrive: The untapped power of bank-fintech partnerships
When it comes to moving quickly on innovative products or going to market, many banks are stepping up partnerships with fintechs—start-up or scale-up businesses that leverage technology to fulfill functions required to deliver offerings to customers—rather than building a product or capability themselves.
Redefining financial stability: Narrow banking excels in the Digital Age
In the ever-evolving landscape of financial services, the concept of ‘’Narrow Banking’’ could re-emerge as a beacon of stability and efficiency, offering a stark departure from traditional banking. While traditional banking operates under a fractional reserve system (in which only a fraction of bank deposits are required to be available for withdrawal), Narrow Banking would require deposit-issuing banks to avoid leverage and steer clear of risky financial investments.
What’s in store for European fintech in 2024? The experts give their predictions
2023 saw fintech fall far behind in overall fundraising, as VCs instead opted for investments into climate tech. On the regulatory front, Europe’s biggest privately owned tech company, Revolut, finished 2023 still lusting after the UK banking licence that continues to elude it.
Elsewhere, it was a good year for German fintech unicorn Trade Republic, which was granted a full EU banking licence, and a bad year for French insurtech Luko, which was placed in receivership after its €14m deal with incumbent insurer Admiral fell through.
So what is in store for 2024? Sifted asked experts for their predictions.
Are banks and fintechs partners, competitors or suppliers?
Over the past decade+ we have seen thousands of fintechs arise. Many are challenging and disrupting, whilst many more are providing and supplying. What is the role of a fintech?
The advice is that fintechs are there to fix the things that banks do badly and offer service to those who banks don’t serve. The unbanked and underbanked is a huge market where fintechs are making a difference. The online processes of checkout and trading is where fintechs are making a difference.
SEC approves first spot bitcoin ETFs in boost to crypto advocates
The US Securities and Exchange Commission has approved the first spot bitcoin exchange traded funds in a watershed moment that cryptocurrency enthusiasts are betting will draw new retail and institutional investors into the market.
The top American securities regulator cleared 11 ETFs to list, with sponsors ranging from established players such as Fidelity and Invesco to digitally focused newcomers including Grayscale and Ark Invest.