The paradigm of challengers and incumbents should be revisited in the light of widespread collaboration between the two, according to Tony McLaughlin of Citi and Mike Massaro, CEO of Flywire.
McLaughlin uses the analogy comparing fintech disruptors as “barbarians at the gate” who were then invited inside the city for a cup of coffee… “There is so much collaboration now. The success of fintech has made banking better. We’ve had to become better to meet the expectations of forward-thinking clients.”
[Massaro:] “I think it is wrong to assume that banks aren’t innovating because they are… Challenger banks and other fintechs just showed them how to innovate a little differently. Incumbent banks were able to invest heavily on infrastructure, for example, an area which is pretty much unavailable to anybody but banks.”
… now that both camps offer many similar products and services, a new era of collaboration between incumbents and challengers looks ripe for the creation of extended platform ecosystems that merge all services into one application.