FinXTech Intel 2023 report final 2 - Flipbook - Page 26
innovation. Fed researchers wrote that several community bankers found that it was useful to learn other
banks’ experiences, and create benchmarks for progress and results.
Pro Tip: Contact the banks who already use the fintech’s product.
Ahead of an integration, other banks used “whiteboard” planning sessions, which are “technical integration
planning sessions that include a cross-disciplinary group of staff and often fintech partners,” the Fed wrote.
An outline and roster of a whiteboard session follows below, drawn from the Fed’s description:
•
Whiteboard sessions lay out the implementation stages, the key milestones the bank wants to reach,
and what financial and staff resources they’ll need to complete the plan within the specified timeframe.
•
Banks should consider inviting in-house experts who work in areas that will have impacted functions
to these sessions, along with members from the bank’s compliance, risk, IT and operations divisions
and senior management team.
•
They may want to consider adding staff members who have extensive knowledge of their core provider’s infrastructure, because these technology connections often require data to flow between the
fintech and core.
•
Management can use these sessions to identify potential implementation issues in advance, understand how data and information will move, identify any application programming interfaces (APIs)
or other connections that they’ll need, plan a proof of concept and clarify staffing needs.
The point of this work ahead of implementation is so a bank can manage and address its business execution risk. A new product or service may take longer to implement than anticipated, require more resources
than a bank allocated, or not resonate with consumers or staff. All of these outcomes will translate into
lost return on investment — the bank has wasted its time and money on a project that failed to deliver.
For a refresher
on due diligence,
go back to
page 14.
“On the execution side of this, none of this is magical stuff. It’s not hard. It’s just a matter of having focus
on it,” Shevlin says.
What Could Go Wrong: Regulatory Snafus
Banks have long contracted with technology partners to help run or manage their operations — look at
the existence of the bank core providers. As banks partner with more fintechs for online banking, loan
applications or to monitor cyberattacks, bankers should also anticipate that their institution’s complexity,
risk and information technology systems will increase. Increased complexity could mean increased scrutiny from regulators.
Regulators expect banks to have risk management policies and procedures that reflect the institution’s
complexity. Regulators will want to see that the bank’s board and management teams have appropriate
governance and oversight in place ahead of and throughout these partnerships.
24 | FINXTECH INTELLIGENCE REPORT
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