Brian Muse-McKenney, CRO of Episode Six, says that despite the volatility, especially amid the bank collapses earlier in the year, the industry has continued to undergo a radical shift. He explains “that this is because consumer preferences continue to gravitate toward digital transactions.”
According to the firm’s CRO, this trend “started with individual consumers, then it “began spilling over into small businesses, and now the demand for digital solutions extends across the full corporate and institutional landscape.”
He added that this includes – but certainly isn’t limited to – “having access to consumer and business installment options, virtual accounts, digital wallets, and virtual card disbursements.”
Given how far and wide the demand for digital has spread, industry players have had no choice but to evolve – or “at least lay the foundation.”
Muse-McKenney continued by noting that “the real-time payments movement that has been taking place all over the world has been and will continue to be a game-changer. In the U.S., this is exemplified by the launch of the FedNow Service, which promises speedy transactions, enhanced cash flow for businesses, and a superior payment experience. For banks and fintechs, adapting to changing regulations is non-negotiable. As we look to 2024, the financial industry must remain agile and responsive as the regulatory landscape continues to evolve.”
He also mentioned that banks have “the perfect opportunity to make strategic investments in 2024 that will set their institution up for long-term success. By looking at the business in its entirety, banks will be able to identify the gaps based on current customer demand paired with where the industry is headed.”
They can no longer afford inaction, and “adopting a solution here and there to satisfy a short-term demand is no longer the answer. 2024 is about focusing on longevity.”
He continued by noting that since customers across the board, “from individuals to corporations, are now demanding nothing less than seamless, secure, and lightning-fast digital payment experiences, banks are required to make an ongoing investment in digitally transforming their businesses.”
These investments, in turn, give banks “the opportunity to establish a powerful and flexible payment platform that will satisfy real-time requirements while future-proofing their institutions.”
He also noted that since the banking industry is “undergoing a profound rethink, fintechs and payment technology companies have every opportunity to lean into being a valued partner.
Long gone are “the days of viewing financial institutions (FIs) as competitors. For example, FIs are diligently exploring the dynamics of core banking platforms, weighing the options between virtual and physical accounts. In turn, they are also assessing the potential cost savings achievable by overlaying modern payments and ledger technology onto legacy mainframe architecture.”
This is the niche space that E6 “has been dedicated to since our inception in 2015. We identified a gap in overhauling legacy systems, and we figured out a way to address it to help banks succeed.”
He added that they “became a true partner – and not just to banks, but to other companies looking to launch innovative payment products.”
According to Muse-McKenney, 2024 is a prime time “for other tech companies to lean into their strengths and find ways to help banks rather than compete with them. At the end of the day, the relationship is symbiotic. Banks benefit from the modern services and solutions that technology companies provide, and tech companies benefit from the long-standing trust and customer relationships banks have established.”