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Fintech partnerships: strategies for successful collaboration between startups and incumbents


10 min read

So, this time I’m talking about fintech partnerships, a topic we know like the back of our hands. After over 500 projects completed and 50+ vendors partnered with other fintech startups, we have a knack for establishing fruitful communication.

However, this particular article concerns a more exciting end of this stick. Brace up! I will unveil the personal benefits and opportunities before startups, financial technology companies, and finance incumbents in their partnerships.

It’s no secret that brick-and-mortar finance feels threatened by fintech companies and startups, and I think this is a flustered move. Fintechs are here to make the users’ lives easier, not to take on a niche occupied for centuries. So, as with AI tech, it’s better to partner with the progress rather than fight it.

Understanding the Landscape

Experts view the market conditions for bank-fintech partnerships as auspicious. According to Yahoo Finance and Technavio, the global fintech sector is projected to reach a market size of $277.22 billion from 2022 to 2027, growing at a CAGR of 20.5%. The increased adoption of digital banking by the financial services industry primarily drives this growth.

Among the leading drivers of the fintech industry growth is the threat of new entrants and rivalry, which pushes brick-and-mortar companies to partner up with fintech startups and enterprises.

Statistics on the Fintech Market size growth

Regulatory frameworks and support are vital in encouraging partnerships between fintech and incumbents. Recent surveys show that about 40% of financial institutions believe open banking will drive collaboration and innovation in the sector while mitigating the most tangible security risk. As for the startups, about 98% note that they would benefit from having a partner to back them up. And what wraps it up is that this partnership doesn’t seize with time; startups long to partner with finance companies even as far as in Stage D.

Four best types of fintech partnerships

So, fintech and bank partnerships can make the future of this industry pivot. But how do you find the best partnership model for your business? Here are the four most popular types of such partnerships types that can help companies and startups advance in their niche.


A Software-as-a-Service partnership indicates a fair trade between an incumbent and fintech partners. The latter provides software solutions to the former, allowing them to expand their offered services or products.

This enables startups to scale their product and reach a more extensive customer base through established distribution channels and enhanced networks. By partnering with incumbents, startups can leverage their market presence and customer relationships, resulting in increased visibility, credibility, and accelerated growth.

Incumbents, in turn, benefit from SaaS partnerships by gaining access to innovative technologies without the need for extensive in-house development. They can improve customer satisfaction and loyalty, tap into new revenue streams, and stay competitive in the rapidly evolving fintech landscape.

Example: A fintech startup specializing in cloud-based accounting software partners with an established bank. The startup can now offer its SaaS solution to the bank’s SME customers. The bank gets seamless access to financial management tools for its clients.


Such partnerships are about referring customers. Usually, the incumbent would refer customers to a fintech startup’s product or service, which the incumbent’s services do not reach. This will allow them to provide more options to the customers.

By leveraging the incumbents’ established customer base and trust, startups can acquire new customers. Referrals also help startups build brand recognition and credibility in the market.

This fintech partnership allows incumbents to provide additional value to their customers. By referring customers to fintech startups, incumbents strengthen customer relationships and enhance their reputation as a comprehensive financial service provider.

Example: A peer-to-peer lending platform forms a referral partnership with a traditional bank. The bank refers customers who do not meet their lending criteria to the fintech platform, enabling these customers to access alternative lending options. In return, the fintech platform shares a portion of the revenue from successful loan approvals.


In a co-branding partnership, two entities collaborate to create a joint product or service, leveraging their brand identities and marketing efforts.

Startups get increased visibility and brand exposure with the incumbents’ established customer base and marketing channels. It enhances customer trust and adoption, allowing startups to gain a competitive edge in the market. These bank-fintech partnerships contribute to risk management, as this type of cooperation enables fintech firms and their prospective partner to stabilize the workflow.

Incumbents, in turn, can offer a differentiated customer experience by integrating innovative fintech solutions. This way, they can position themselves as technology-forward and customer-centric, attract new customers, and retain existing ones.

Example: A digital wallet startup enters into a co-branding partnership with a leading e-commerce platform. The platform integrates the digital wallet as a preferred payment option, featuring joint branding and marketing campaigns to drive customer adoption and usage.

Fintech integration services

This type of partnership characterizes a fintech startup integrating its technology with an incumbent’s existing systems or platforms.

This way, startups get access to an established customer base, allowing them to showcase their capabilities and expand the user base. They also can benefit from increased market reach and revenue opportunities. Fintech integration services can also help with regulatory compliance since they might allow incumbents to implement advanced security tools and startups to meet market requirements.

For financial institutions, integration services expand their offerings and client satisfaction. They can advance with the startups’ specialized expertise and cutting-edge technologies, delivering more value to their customers.

Example: An investment management platform partners with a financial advisory firm. The startup integrates its investment tools and analytics into the firm’s existing wealth management platform. This enables financial advisors to leverage the startup’s technology, providing clients with more comprehensive and data-driven investment advice.

Identifying the Right Fintech Partner

The issue of finding the One fintech partner is quite tangible, as many financial institutions aren’t willing to partner with startups in the early stages. Others, who are open to such deals, can present as unreliable or have cumbersome processes in their workflow.

So, here’s my advice for looking for a fintech partner – avoid the red flags and identify what you want to achieve. Realistic goals and KPIs will help you dissect what you can bring and what you will get from a partnership.

Aside from this advice, I have gathered criteria to help you identify a potentially successful partnership before you delve into it.

Criteria for a successful partnership

  1. Defined objectives: ensures that both parties are aligned on the desired outcomes of the partnership. For example, a fintech startup and an incumbent bank may partner to provide seamless cross-border payment solutions to small businesses. The objective would be defined before the alliance is struck so that both parties can create tangible KPIs to monitor the results.
  2. Similar audiences: enables more efficient partnerships in the same segment. You should only go for partners with the same audience, like SMEs, micro-investors, etc. The perfect example that comes to mind is, let’s say, a robo-advisory platform and a traditional wealth management firm. They can partner to cater to tech-savvy millennial investors seeking personalized investment advice. Their audiences are the same. Therefore, the alliance will benefit both parties.
  3. Compatibility of services: partnerships thrive when the services offered by both parties complement each other. A digital payment provider and an e-commerce platform can collaborate to provide a streamlined checkout experience by integrating their services, and their customers will equally win from such a solution.
  4. Refined KPIs: establishing key performance indicators (KPIs) allows partners to measure the success of the collaboration. The KPIs might relate to loan approval rates, default rates, customer satisfaction, or other factors.
  5. Comfort communication channels: overall, essential for a smooth partnership. Whether through regular meetings, email exchanges, or dedicated project management tools, partners must establish clear lines of communication.
  6. Fair resource distribution: the allocation of resources, such as funding, expertise, and personnel, should be based on agreed-upon terms. Discuss time, finances, plans, and other resources you need with your partner to achieve better results, then create a resource allocation plan.
  7. Technological compatibility: ensures seamless integration and interoperability. Startups and banks would need compatible technologies to work together. Otherwise, the partnership would be pointless. If you’re a startup looking for a partner, first check that the incumbent you want to work with has a similar technology environment or is ready to go along and change to accommodate your joint venture.
  8. Roadmap: a shared roadmap outlining the partnership’s steps, milestones, and timelines helps partners stay focused and aligned. This ensures that progress is made and that both parties move toward their shared goals.
  9. Flexibility: will help navigate challenges and leverage emerging opportunities. Flexibility includes but is not limited to adjusting strategies, accommodating changing market dynamics, or pivoting the partnership’s direction when necessary.
  10. Cultural fit and shared values: strengthens the partnership and enables more efficient collaboration. Ensure that your values and cultures align; for example, if you’re an inclusive fintech startup, don’t partner with companies that didn’t reach this milestone yet. Misaligned values and culture will cause mishaps in your workflow, which will be more problematic than profitable.
Looking for a fintech partner to back you up?
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Advantages of fintech partnerships

  1. Better brand visibility. Fintech partnerships allow startups and incumbents to enhance their brand visibility. Both parties can increase their market presence and reach a wider audience with joint advantages of higher equity, better technology, agility, modern services, and enhanced security.
  2. Outreach to new customers. Partnerships enable fintech companies to tap into new customer segments that may have needed help to reach independently. Startups, in turn, can gain new audiences by providing their services through incumbents. This helps drive growth and market penetration for both parties involved.
  3. New products and services. Collaborative fintech partnerships often result in the development of new and innovative products and services. Startups bring cutting-edge technologies and ideas, while incumbents contribute their market knowledge and industry expertise. By combining these strengths, partnerships can create groundbreaking solutions that address customers’ unmet needs.
  4. They are overcoming compliance challenges. Fintech startups often face significant regulatory compliance challenges when entering the market. Partnering with incumbents with established regulatory frameworks and compliance processes can help startups navigate these challenges. This results in faster time-to-market for fintech while incumbents gain the widened services or new technologies embedded in their operations.
  5. Access to resources. Fintech partnerships provide startups access to valuable resources that may have been limited otherwise. These resources include funding, infrastructure, technology systems, talent, and industry connections.

Real-life Cases of Successful Bank-Fintech Partnerships

The idea of a fintech partnership isn’t precisely novice, and you won’t be the first hopping onto this train. And, since numerous incumbents and startups benefit from this, let’s look at what they did and how they achieved it.

Pleo + Yapily

According to research, poor cash flow management is the cause of failure for 82% of businesses. So, Pleo, a Fintech unicorn, and Yapily, a UK open banking company, are joining forces to tackle this issue head-on by harnessing the capabilities of open banking.

Through Yappily Payments, Pleo users can now go directly to their Pleo accounts from their bank accounts. This innovative feature enables customers to receive funds instantly, seamlessly, and fast. As a result, businesses throughout Europe gain access to faster and more efficient cash injections. This enables them to calculate and manage their cash flow accurately, ensuring prompt payment of bills and empowering them to seize opportunities as they arise swiftly.

INSHUR + Premium Credit

INSHUR, a digital insurance platform for rideshare and taxi drivers, collaborated with Premium Credit, a leading premium finance company.

Through this partnership, INSHUR offered its customers the option to finance their insurance premiums through Premium Credit’s flexible payment plans. This enabled INSHUR’s customers to manage their cash flow more effectively without paperwork or waiting lines.

Deutsche Bank + Traxpay

Deutsche Bank, one of the largest banks in Europe, partnered with Traxpay, a fintech startup specializing in supply chain financing solutions.

The partnership enhances Deutsche Bank’s transaction banking services by leveraging Traxpay’s innovative technology. By integrating Traxpay’s platform, Deutsche Bank can offer its corporate clients improved visibility, automation, and efficiency in supply chain financing. This, in turn, enables faster and more secure B2B payments.

N26 + Wise

Through the strategic partnership with Wise (formerly TransferWise), N26 customers can access various currencies and make international transfers at the actual market exchange rate. This ensures transparency and fairness in currency conversions.

Integrating Wise’s services into the N26 app makes the process even more convenient. With just a few taps on their mobile device, N26 users can initiate and complete international transfers without hassle. This partnership empowers N26 customers to manage their global financial transactions effortlessly and supports their needs for international payments.


Fintech partnerships can be highly beneficial for growth and development in the financial landscape. As in any good alliance, everyone should benefit from the deal struck as it enables startups to be more secure and trustable, while incumbents get agile processes and modern technology.

If you’re looking for a partner or want to establish a connection with an incumbent but don’t know where to start – book a meeting with me. My colleagues or I will happily assist you in this complicated process.

Together we can change fintech by leveraging smart and innovative solutions.

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