Often viewed as a bellwether for advances in banking technology, the Nordic markets are experiencing a significant spike in collaboration between banks and fintech startups.
According to the “Innovation. Delivered: Fintech Disruptors 2017 Report” sponsored by DNB, 74% of Nordic banks intend to collaborate with fintech firms in 2017. This finding is in sharp contrast to 2016’s study, which found that less than 50% of Nordic banks had any defined strategy for fintech.
Fully 42% of financial institutions surveyed want to set up fintech incubators and expand their existing partnerships with startups in addition to the 74% that want to create new partnerships.
Halvor Lande of DNB comments: “The winning banks of the future will be those that emulate the working practices, culture and methodology of successful tech companies: smart existing banks will have to learn from fintech start-ups.”
The report reveals evidence of emerging fintech specialisms in Nordic markets. Norway is viewed as a hotbed for authentication and security with companies such as Encap, Zwipe, Promon, Signicat and the bankID consortium; Sweden is becoming recognised for e-payments thanks to companies like Trustly, Klarna, iZettle and Wrapp, while Denmark’s specialism in blockchain is seen in companies such as Chainalysis, Blocktech, Brainbot and WeMoveCoins. For Finland, Holvi, Zervant and Arex underline the country’s expertise in e-invoicing and electronic banking for SMEs.
The report underscores Nordic sophistication in technological enhancements. Whilst 56% of respondents from other European countries remain concerned with payment technologies, Nordic markets cite security and fraud management (37%) as their major concern, reflecting the fact that electronic payments have long been viewed as the norm in Nordic markets.
Looking ahead to 2020, Nordic respondents see a wave of fintech mergers and acquisitions (36%) and the emergence of a new banking business model (36%) as the most significant developments - whereas 43% of respondents from the rest of Europe cite real-time payments as the biggest development.