FTT Financial Services Futures: Experts Make the Case for Partnerships Between Financial Institutions and Fintechs

By John Egan

Financial institutions should embrace fintech partnerships, including those focusing on embedded payments capabilities, to fulfill customers’ expectations, participants said during a session at the FTT Financial Services Futures conference, held Nov. 18-19 in Austin, Texas Finopotamus, an official conference media partner, was onsite to cover the event.

Speaking during a panel discussion titled “The North American Fintech Market – Capturing a $145 Billion Dollar Opportunity,” Dominik Weisserth, the Americas head of enterprise services banking for the SAP Fioneer financial services business, said embedded payments are a key component of one-stop-shop banking capacities.

Dominik Weisserth

“As consumers change their behavior and are used to more holistic solutions like this, everybody will look more for that capability, which then drives more of the innovation that people need to bring,” Weisserth observed.

According to Weisserth, partnerships between financial institutions and fintechs can generate those innovations.

Backing up Weisserth’s observation about embedded payments, a recent white paper from KPMG suggested the fintech sector should deliver “more holistic and tailored customer experiences” — including real-time financial insights and customized investment recommendations — to meet “everything, everywhere, all-at-once demands” of customers.

Capitalizing on Fintech Partnerships

Fellow panel participant Guillaume Bouvard, co-founder, COO, CMO of Extend, which offers a virtual card platform and spend management software, said scaling up operations to take advantage of fintech opportunities presents a big challenge for financial institutions and fintech companies.

Guillaume Bouvard

“Technology, at the end of the day, is just a capability. It is not a product,” Bouvard said. “Technology is the capability that enables all of us in financial services to meet demand and solve problems.”

When collaborating on fintech offerings, financial institutions and fintechs must come to “a common understanding,” Weisserth said. For financial institutions, he added, this means they should gain know-how about various aspects of the fintech sector, such as how fintechs are financed and what drives their growth. For fintechs, this translates into grasping the array of regulatory burdens that financial institutions face.

“The technology is no longer the limiting factor,” Weisserth said. “It is the contracting, it is the compliance, it is understanding the revenue model.”

Welcoming Collaborations with Financial Institutions

Bouvard agreed with Weisserth, saying that while some fintechs attack financial institutions, others don’t try to compete with them. The non-competitors in fintech “actually want to partner with the bank, because they realize the cost of acquisition of customers and the trust is so critical to scale that they cannot do it [on their own]. They do not have deep enough pockets to do that,” Bouvard said.

Jim Perry

Even so, some financial institutions in the U.S. remain skittish about fintech partnerships, explained session moderator and fintech expert Jim Perry, senior strategist at Market Insights, a consulting firm that serves financial institutions. “You will find pockets across the country … where you've got people looking at fintech providers of any size or shape as the enemy, as the competition, as opposed to the partner.”

Treating Fintechs as Teammates Instead of Rivals

Credit unions, the panel agreed, benefit from partnerships, instead of rivalries, with fintechs.

The 2025 Credit Union Digital Experience Report from market intelligence company Finalytics.ai found that despite the popularity of peer-to-peer payment apps like CashApp, PayPal, Venmo and Zelle, 31 of the 100 credit union websites reviewed by Finalytics.ai lacked a P2P feature. The credit unions included in the Finalytics.ai analysis are the 100 largest in the U.S. as measured by asset size.

A 2025 survey by market research company PYMNTS Intelligence and payments CUSO Velera suggests fintechs are more eager to collaborate with credit unions and smaller banks as they move away from partnering with national and regional banks. In fact, the survey of 100 U.S. fintech executives showed a 19% increase from 2024 to 2025 in the share of fintechs partnering with credit unions to sell end-user products and services.

Overcoming Fintech Partnership Roadblocks

Partnerships between credit unions and fintechs aren’t without their obstacles, though. For instance, 38% of fintech executives in the noted survey, whose companies serve credit unions, cited the slow decision-making processes at credit unions as the biggest barrier in working with them, followed by complex rules and regulations at 34%.

Despite the challenges, partnerships between financial institutions and fintechs can bring “great value” to customers, Bouvard said. In fact, for many smaller financial institutions, partnerships may be the best or even only avenue for working with fintechs. Why? Smaller institutions generally lack the money to purchase a fintech or the money and tech talent to develop in-house fintech capabilities, Bouvard added.

Perry noted that his small financial institution clients often resist adjusting their business models, thereby limiting their ability to redirect money to fintech and other initiatives. These institutions must “step outside their comfort zone” so they can advance their business models, he said.

“One of the biggest challenges I see is folks looking at underperforming branch models and not being willing to let go of those branches in order to redeploy that capital, in order to do partnerships that are going to help them deliver more for their customers,” Perry said. “So, part of it is a mindset. Part of it is allowing themselves to think outside of how they’ve always done business.”