Banks: Cooperation with the FinTech ecosystem in the context of digital transformation

The field of new innovative financial technologies and the activity of start-ups (finTech) is at the heart of the strategy of the banks that closely follow the developments in the field and make significant investments for their digital transformation that is in full swing. As systemic banking executives have pointed out, the domestic banking system is in an open line of communication and cooperation with the ecosystem of start-ups in this field and deals with it in addition to the actions carried out in the field of their technological development.

The strategy and their positions on this issue, in the context of their wider digital transformation, were developed by the CEOs of the 4 systemic banks at the recent MoneyReview conference

Pavlos Mylonas – National Bank

All traditional banks are investing in their digital transformation to face not the fintech companies, but to meet the demands and needs of their customers, said the CEO of the National Bank Pavlos Mylonas, stating that NBG, in the context of the transformation program has made huge leaps to the digital transition. According to Mr. Mylonas, the National Bank, having already invested enough funds and with investments continuing, has the largest number of active digital media users in the market, with more than 2 million, with a market share of 32%. According to Mr. Mylonas, apart from investing in digital banking, Ethniki’s goal is to cooperate with fintech companies, which it does not consider to be competitive with banks, but complementary, as fintech companies usually specialize in a specific service. The recent agreement announced by the National Bank with EVO Payments in the field of payments, was not made for capital reasons, but is the first step in implementing a strategy of strategic partnerships with fintechs through which the Bank will take advantage of the synergies of the most technologically advanced companies, added Mr. Mylonas.

Vassilis Psaltis – Alpha Bank

The distinction between the mission of a banking institution and the initiatives of fintechs was highlighted by the CEO of Alpha Bank Vassilis Psaltis. Alpha Bank’s goal is the complete and easy access of the customers to its banking, investment and bank insurance services, in order to cover 100% of the needs of the society and the creation of multiple points of contact with the customer for the achievement of the social mission in terms of financial inclusion, said Mr. Psaltis. “We are investing in our technological infrastructure and constantly evolving our digital services to customers and, secondly, we seek partnerships with fintech, in order to offer our customers additional quality services and modern digital experiences”, added the CEO of Alpha Bank, for Note that in addition to the continuous expansion of the digital transformation of its products and services and the continuous upgrading of infrastructure to enhance the security of transactions, areas in which it invests more than 100 million euros annually, the Bank organizes in recent years innovation competitions, such as Finquest, through which more than 200 Greek and international fintech and more than 80 innovation teams consisting of its employees have emerged. At the same time, it utilizes both the Bank’s private equity arm, Alpha Ventures and strategic partnerships with the Venture Capital Funds of the market, in order to strengthen relevant fintech capital, further helping the creation of innovative digital services and products.

Christos Megalou – Piraeus Bank

Regarding the competition of banks with fintech, the CEO of Piraeus Bank Christos Megalou pointed out that Piraeus Bank closely monitors the space and developments in Europe and makes significant investments in technology. As Mr. Megalou said, the specific investments amount to 140 million euros this year and a corresponding amount in 2023, while it is cooperating with Microsoft for the transition to a cloud environment. The CEO of Piraeus Bank stressed that the advantages of large organizations such as banks, and especially the broad deposit and customer base they have, should not be overlooked. As mentioned, the transition of Piraeus Bank’s technological infrastructure to the cloud will act as a catalyst for innovation, providing pioneering and secure banking services that comply with the current regulatory framework. Through the cloud, Piraeus Bank seeks to increase the overall operational efficiency and flexibility, the faster launch of new products and services, the improvement of the level of customer service, the reduction of IT expenses but also the achievement of sustainable development, with the reduction of energy of the fingerprint.

Fokionas Karavias- Eurobank

Start-ups in the financial sector are a reality, said Eurobank CEO Fokionas Karavias, noting that they have prospects and advantages – they are flexible and develop technological solutions more easily. But growing up to compete with traditional financial institutions they will find that things are not always easy, as on a larger scale they will also face challenges, such as. operating in a highly regulatory environment to which they are not accustomed. Their presence is more of a motivation to improve than a threat, he added. Eurobank has chosen a specific strategy, it will not compete with fintech companies, it will not become a digital bank. “Our model is phygital, a combination of the physical and the digital world. We are talking about the evolution of traditional banking to keep pace with today’s conditions. At the base will always be the personal relationship, trust, direct contact between the banking “At the same time, however, we are equipped with the most modern technological means so that physical contact exists where it is needed and has meaning and utility, while other operations, all other banking operations can be done electronically and digitally,” he said. Mr. Karavias.

Eurobank, among other things, said Mr. Karavias, invests in the utilization of data, the wealth of which it currently utilizes relatively limited, in artificial intelligence and machine learning, that is, algorithms and tools that will allow us greater efficiency and lower costs in various critical areas such as regulatory compliance, credit risk assessment for new financing, marketing, etc. to reduce costs but also to provide faster responses and customer service.

Source: AMPE