Banks Vs Fintech: the clash of values

I did a quick inventory of the values as stated by the major US and European banks*, and did the same exercise for some of the largest Fintech**

It is not a systematic scholarly study, but it gives you a good flavor of their respective business principles.

Banks

“Clients” is what comes first. No surprise – even if they sometimes fail to do so, most businesses in most industries intend to put their “Clients first”. Clients, along with “Shareholders” and “People” (employees), form the trio of key stakeholders to look after. US banks often mention “communities” in addition.

Then we have “Responsibility”, “Integrity” and “Excellence”. I think it shows the actual high standard of professionalism and level of control/compliance rules developed by this major institutions. However these values were probably emphasized following the repeated misdeeds that happened in recent years, resulting in billions of fines and a deteriorated image: banks need to show that they moved on and that this period is over.

“Innovation”, “Simple” and “Creativity” are also often mentioned. I have a double interpretation:

  • It reflects the actual business innovation capabilities of the banks in terms of financial solutions/product structuring
  • It is more an ambition/wish in regards to what is happening in the technology space. Most of the banks rather follow the trend than lead the digital agenda (2 interesting articles here and there)

Fintech

No surprise to come across the technical terms “online”, “mobile”, “technology” and “software”. What is more surprising is the frequency of the words “business”, “commerce”, “consumer” and “grow”. In their statement of intent, Banks seem more client-focused and Fintech more business-oriented.

There is a strong emphasis on “privacy”, “trust” and “security”, because this is clearly one of the main concern: people must be confident that they can entrust their money to these startups.

Finally Fintech aim to provide “easy”, “cheap”, “transparent”, “smart” and “simple” services. These are the key differentiating factors and what makes Fintech so attractive. I think that speed is also a key factor: I would have expected “fast” and “real-time” to be more emphasized. The term “user experience” is surprisingly absent, maybe because “simple” is enough when you actually do it…

Final word

To avoid being brought down by the Fintechs little by little, service by service, I believe banks need to:

  1. Truly demonstrate the values they put forward: innovation, excellence, simplicity. Serving “clients” is giving them what they expect: simple and fast services at the right price.
  2. Integrate in their core values the key values of our digital age: how come “technology” and “security” don’t show in the banks’ word cloud?

Financial Institutions are aware of what is happening in the market. They don’t need to change 180-degree, but their internal culture has to evolve. It requires maneuverability (flexibility and speed) and leadership.


* BNP Paribas, Societe Generale, Credit Agricole, Deutsche Bank, HSBC, Barclays, Lloyds, Credit Suisse, UBS, ING, Santander, BBVA, Morgan Stanley, JP Morgan, Goldman Sachs, Citi, Bank Of America, Wells Fargo, BMO, TD, RBC and Unicredit. Words have been extracted from their corporate website from the “About us”, “Our values”, “Business principles” or “Our mission” pages.

** Lufax, LendingClub, Square, Stripe, CreditKarma, Dataminr, iZettle, Coinbase, Betterment, Braintree, Cardlytics, Kabbage, Xero, FundingCircle and WorldRemit. Words have been extracted from their Front page or “About us” page.

Word clouds realised with wordle.net

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