How strong is the need for collaboration between FinTechs and banks?
Sarah Häger, Head of Open Banking Community, Nordea
Nordea is the largest financial services group in the Nordic region and one of the biggest banks in Europe. With 200 years of experience in the banking business, presence in 20 countries, and a total operating income of €9bn, Nordea successfully demonstrates how to succeed in banking. Read our exclusive interview with Sarah, who, ahead of speaking at MoneyLIVE: Nordic Banking 2019, is talking about the bigger picture of open banking, collaboration between FinTechs and banks, ‘ecosystems,’ and more!
Looking at the bigger picture of open banking: how strong is the need for collaboration between FinTechs and banks?
On a general note, I believe that there is a large need for collaboration. However, this will really depend on the particular needs and challenges facing the bank and whether they can be met by the fintech. In the personal banking space, I believe fintechs will continue to push forward at the forefront of product development. However, on the corporate side, BigTechs will remain an important supplier or partner to the banks. In order for collaboration and innovation to happen, both parties need to have a desire to move away from their established positions of supplier-buyer, towards a partner like structure.
“Both parties need to have a desire to move away from their established positions of supplier-buyer, towards a partner like structure.”
Open banking evolved: what are the catalysts for ‘ecosystem’ to go from being a buzzword to a reality?
One of the catalysts has been a kind of cultural maturity which has enabled a mindset shift towards working with partners in an ecosystem as an accepted norm. This has slowly replaced the traditional way of working that all solutions should be produced in-house, with the idea that using partners to supply the customer base with solutions can access a larger pool of potential innovation. At the same time there has been a process maturity as procedures and networks have become established to formalise agreements and meet regulatory requirements, etc. Then of course we now have the technical maturity with the platform and systems in place to really allow the ecosystem to function and flourish. Perhaps one of the most fundamental catalysts is the long term buy in from senior management who needs to have expressed a real willingness and push towards shifting to an ecosystem approach.
“Using partners to supply the customer base with solutions can access a larger pool of potential innovation.”
As more banks launch their open banking products and platforms, what will be the key differentiators that will attract FinTechs?
The main success factor for attracting and engaging a community is ensuring that the members experience a real feeling of being valued for participating, which makes them much more willing to give back to the community. In other words, if you are able to deliver the things that your community values then it will flourish! Naturally the mindset of the bank and its genuine willingness to collaborate as well as the processes that are in place to enable efficiency are critical differentiators. The attractiveness of the bank will also depend on factors such as the amount of bank customers the fintech can reach when collaborating as well as the maturity of the market where the bank’s customers are residing.
What is next in the pipeline for open banking at Nordea and where do you see open banking heading in the long-term?
Our long term vision is to move further towards platformisation and to utilise our market leading Open Banking platform to become the Nordic hub for open APIs. Today, shortly ahead of the deadline, Nordea Open Banking has a high focus on PSD2 compliance deliveries. Alongside those, we are also collaborating with internal units in the bank as well as with external corporates or partners to push forward with innovation for our customers and to enable different internal departments to provide the latest developments for our customers. Some examples of the solutions that we have already launched this year are Instant Reporting, FX list-rates/trades or consumer financing which we have made available through APIs.
Sarah Häger is heading the Open Banking Community team, whose purpose is to give the Fintechs and developers a good experience, while realizing their ambitions on Nordea’s api platform and to co-create the solutions of tomorrow for corporate customers. Sarah is responsible for Nordea’s +2900 external developers. She has lived in Germany and Sweden and worked with large European corporate clients in Sales, Services for the last 10 years and is now active in the Solutions area to create the open banking of tomorrow.
Sarah will be speaking at MoneyLIVE: Nordic Banking taking place at the Radisson Blu Scandinavia, Copenhagen from the 21 – 23 October 2019.
MoneyLIVE: Nordic Banking is the Nordic region's leading banking innovation conference, uniting 300+ banking experts from retail banks, challengers, FinTechs and solutions providers for three days of content set to revolutionise the banking landscape.