Competition from fintechs and consumer brands is compelling leading banks and technology providers to revise their strategies. These fintechs and brands are scaling and evolving rapidly on top of banking as a service (BaaS) and open banking infrastructure. We’ve spoken with executives at financial institutions, fintechs, and vendors about how to thrive in an ecosystem that’s reshaping financial services.

Payments Ecosystem: This year will reveal how providers must adapt to lasting pandemic-driven digitization across payments channels, ranging from in-store retail to B2B ecommerce.

Federally insured credit unions can team up with third-party digital asset providers and keep members who want to explore this asset class within their ecosystem.

What it means: The new checking account helps Amex tap into three growing areas of the payments and digital banking ecosystem. Relationship rewards.

While commission-free trading isn’t unique, bundling it with crypto and savings features will increase the time the UK-based neobank’s US customers spend with it.

In just five years, the physical framework of banking will be “dead,” according to bank executives around the globe—supplanted by digital ecosystems and supported by emerging technologies.

Neobanks that in-source credit building can build foundations for lending income and keep customers within their ecosystems. Products like these can also help challengers ward off the risk of commoditization.

Report: The US Wealth Management Ecosystem. Article: Avant broadens its digital banking capabilities with challenger acquisition. Article: Has the pandemic reshaped Gen Xers’ spending?

Related content: Check out the Bank-to-Bank electronic transfers section of the “Payment Methods and Funding Mechanisms” report, which is part of our payments ecosystem report collection.

Foss also said that Jack Henry wants to go beyond being a core-banking processor and offer “a full banking ecosystem.” It’s giving banking clients access to third-party vendors like Finicity, Alloys, Dell, and Autobooks. He noted that Jack Henry has over 850 fintech partners and nearly 8,500 FI clients.

In our January 2021 Banking Digital Trust Survey, the largest proportion of US digital banking users cited their primary bank or credit union as the company they would trust most to provide them with financial services, beating out Big Tech and payments rivals. What Banks Stand to Win—and Lose—in the Super Apps Market. Super Apps Can Unlock New Revenue Streams for Banks.

Fidelity led the round, underscoring the US appetite to extend capital to the fast-growing fintech ecosystem.

Revolut’s users who adopt BNPL may become more engaged with the neobank due to spending more time within its ecosystem and running up BNPL balances they have to monitor and pay down. The product has greater potential for loyalty building than for driving new user growth in an increasingly crowded BNPL market.

Simple touchpoints entice customers to store credentials in the wallets, making them readily available for other offerings, like lending, digital banking, and credit.

Once they’ve entered the Revolut ecosystem, its breadth of features—from budgeting and savings tools to investments and crypto custody—could foster a healthy primary bank relationship in which Revolut becomes the hub for all of the client’s financial needs. The new feature also offers Revolut a way to get its foot in the door with business clients.

New technology has enabled innovation that lets providers embrace ecosystems with greater ease. Large providers are moving to create these ecosystems for their clients to avoid losing customers to competitors. Smaller PSPs can develop software- or hardware-based tools that can be integrated into these ecosystems through APIs or software development kits (SDKs).

Why ONE could succeed: By our definition, a super-app entails a digital ecosystem of services and products located within a single ecosystem and user experience. The super-app space is a promising one for Walmart. It’s logical that a superstore offering all kinds of goods might also offer a super-app.

Vidal also flagged the opportunity for fintechs that can make digital banking “super friendly and easy to understand for people who haven't had access to those types of services before.”.

KEY STAT: More than 40% of US digital banking users would trust PayPal to provide them with banking services, signaling that as Big Tech pushes into banking, it will become a viable competitor for banks. Introduction.

Payments Ecosystem: Diminishing analog payment use—as well as the battle for share between entrenched electronic payment methods and emerging challengers—will intensify the battle for customer spending this year.

The newly launched app merges its small-business seller and consumer Cash App ecosystems, allowing US sellers to accept payments made via the Cash App peer-to-peer (P2P) payment platform. In 2022, Square will leverage this blended ecosystem to add not only BNPL—thanks to its Afterpay acquisition—but also Tidal, which we predict will provide direct payment capability for content creators.

For example, although fintech ecosystems in France and Germany are burgeoning this year, they still trail far behind the UK.