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If the banks had a thought through strategy of where they want to go and engaged Fintech companies and customers at an early stage to help design and build new services as part of a complete customer solution then we might see innovation that will make a difference.

That does not yet appear to be happening.

Clearly there is no ambition here to build a disruptive service to take on the card schemes.

Absolutely agree! Before the banks can adopt disruptive technology there needs to be a committed change in mind set, from the top down. This change in attitude seems to be half hearted at the moment with banks just tinkering at the edges as opposed to a full blown overhaul of their busoness practices.

How can MasterCard's acquisition of a payment service that could, under PSD2, provide direct competiton to the card schemes be possibly thought of as increasing competition?

Or am I missing something?

If the banks were to adopt an integration platform or bridge to their core platform to manage all the peripheral applications and third party providers meaning just one point of integration, this would take a lot of the strain from the core platform, manage the security issues of having multiple API's and allow for a controlled transition to new systems. Or even allowing the old core platform to continue while new applications and developments continued on a new platform.

This would make the whole process of modernising the banks system less terrrifying.

Totally agree!

Since when did we as a nation become so timid & risk averse.

Fintech by its very nature is disruptive of the status quo and here is a glorious chance to concentrate on the positives and take advantage of the opportunities that will arise and treat the negatives as merely obstacles to overcome which will probably strengthen your business.

Having a layer between the banks and fintech or any other third party service providers will make life easier and speed up the process for the banks and service providers to collaborate without compromising the banks core platform or security

Having a single integration and connections platform to connect multiple service providers to a banks core systems will ensure efficiencies in managing any number of suppliers while leaving the core banking platform undisturbed.

With the right platform connecting their core banking to the new Fintech service providers Banks can take advantage of the opportunities presented by PSD2 by offering new services to their existing clients to generate additional revenue streams and create loyalty as well as offer these services to the customers of their competitors. The opposite of the current perception that the banks are going to lose customers and reduce revenues. All it takes as Jean  says is the right mindset.