Banking strategies for growth should be checked before making a stock investment in the banking industry. The reason is that the banking industry itself is a very mature industry which has usually limited growth potential. Management Consulting Firms like Mckinsey or Deloitte make their money giving plenty of theoretical advice about banking strategies for growth. In comparison, we are looking at how banks focus on supporting startups and are forming bank fintech partnerships to develop new banking growth strategies. The reason is that learning about the future of fintech will enable us to develop a better understanding about the future of the banking industry and thus potential stock developments.
TD Bank (Florida) – Startups and Bank Fintech Partnership Examples
We began our series “15 Things You Need to Know” with the TD Bank. This is why we started looking at their banking growth strategies first. TD Bank “announced that it’s earmarking some of its $30 million FinTech investment fund to help early-stage FinTechs tackle patent applications.
The bank plans to dedicate $3.25 million to giving startups patent applications and expertise to secure their IPs. The program, which does not take equity, is meant to help the bank scope out potential partnerships without formalizing agreements at the outset.
In the past, TD has leveraged startups to power its own customers’ experiences; Toronto-based Flybits, which has a partnership with TD, powers the bank’s digital concierge that notifies customers of local deals and discounts.”
TD Bank is obviously trying to improve digital communication and services with its customers. This could lead to better business relationships and is a positive indicator that TD Bank banking growth strategy (at least in the fintech area) heads into a very positive direction.
TD Bank – Fintech Partnership Examples
Furthermore, in April 2022 TD Bank announced “that it will collaborate with FISPAN, a leading North American fintech, to embed TD Commercial banking products and services into Enterprise Resource Planning (ERP) and accounting software for Commercial customers. This will help these customers to automate cash management processes, creating an integrated digital tool to help businesses manage their payments and financial information with the bank.”
JP Morgan – Practical Banking Strategies for Growth
JP Morgan has the probably most impressive banking growth strategy in fintech. They have a strategic Investment team that partners across JPMorgan Chase & Co. to make minority investments in emerging technology and FinTech companies to further accelerate innovation and digital transformation. JP Morgan works with its portfolio companies in numerous ways, sometimes as a consumer, helping them enhance their product offerings and bring long-term value. The team consists of more than 20 investment professionals located in New York, London and Hong Kong, with support teams in New York and Chicago. A banking growth strategy that should impress every stock investor in the banking sector
JP Morgan – Bank Fintech Partnership Examples
In September of 2022 JP Morgan acquired US payments FinTech Renovite. The company offers cloud-native technology to optimize payments processing. Renovite’s people and technology will be absorbed into JP Morgan’s payments division so that JP Morgan will gain a more efficient payments platform and it can offer clients the ability to process transactions through a wider variety of methods.
Royal Bank of Canada
Royal Bank of Canada is the biggest Canadian Bank and an interesting stock. Regarding their banking strategy of growth, RBC seems to focus on the service industry. The bank has its own venture company called RBC Ventures. An example for an RBC venture is “CareEasy is an app designed to support those who support others. The easy-to-use mobile app provides family caregivers with the resources and assistance they need to look after their aging loved ones.” Their investments seem to focus on apps that make life easier. Unfortunately it is difficult to understand how most of these ventures can contribute positively to the growth strategy of the Royal Bank of Canada and thus to a positive stock performance.
Royal Bank of Canada – Bank Fintech Partnership Examples
In June 2022 RBC announced that the bank has partnered with open banking fintech Plaid to allow RBC’s 17 million customers to share their financial data through a direct Application Programming Interface (API) with the services on Plaid’s data network.
Bank of Montreal – Practical Banking Strategies for Growth
Bank of Montreal is also a big player in the Canadian Banking Industry with interesting key data that makes an analysis worthwhile. BMO does the typical entrepreneurship competition programs and special financing for black owned businesses.
In 2019 BMO announced an “expanded partnership with leading digital lending platform Blend, having participated as a strategic investor in the company’s recent Series E round. The expanded relationship will further accelerate the bank’s digital strategy in North America.” This corporation with Blend definitely reflects an innovative focus in the company’s banking growth strategy.
Bank of Montreal Bank Fintech Partnership Examples
In April 2021 BMO Harris Bank announced its partnership with Hope Trust, a technology-based planning service and trust administration platform for clients with special needs and their families. Very interesting partnerships that clearly focus on improving customer services.
CIBC – Practical Banking Strategies for Growth
CIBC runs a youth accelerator program that finances High school students’ entrepreneurial activities. This is an initiative aimed at removing barriers for the next generation of leaders from the Black community by supporting their education and career ambitions.
CIBC – Bank Fintech Partnership Examples
In March 2022 CIBC announced that it “is partnering with Pollinate to bring “Tyl by CIBC” to Canada later this year. Tyl is a cloud-based digital-first platform for small and medium-sized businesses (SMBs), that enables safe and secure payments acceptance, provides easy point-of-sale technology, and helps users administer loyalty programs.” Very interesting partnership that could be a huge step for the Canadian economy. The reason is that “Canada has over one million small-and medium-sized enterprises, and our new platform will meet their changing needs as we emerge from the pandemic and focus on growth.”
A partnership that reflects a banking strategy for growth that gives trust to every potential long term CIBC stock investor.
Citigroup – Practical Banking Strategies for Growth
Citigroup has its own venture firm to invest in and partner with category-defining startups with the potential to augment and enhance Citi’s products and services. Through this growth strategy, they aim to find future growth opportunities for Citi and develop new products and services that respond to the changing business, societal, and economic landscape of the 21st century. Great initiative that also has a location in Europe.
Citigroup Bank Fintech Partnership Examples
In spring of 2021 Citigroup announced a partnership with the Fintech firm, Sharegain to launch a fully automated securities lending solution for wealth management companies. “The newly launched solution by Citi will enable wealth managers to deliver a securities lending program to their clients. The bank mentioned that it has designed the solution in a manner to integrate with the existing IT infrastructure of the wealth managers.
Citi said that wealth management firms can now earn additional revenue on their stocks, bonds, and ETFs, without developing an internal program from scratch. The newly launched solution provides a fully digital experience.”
Wells Fargo
Wells Fargo hosts a semiannual six-month accelerator program in San Francisco that connects fintech entrepreneurs with industry experts, mentors, bank professionals who are potential customers and venture capitalists who are potential investors. The bank offers successful participants up to a startup could receive an investment of up to $1,000,000. Wells Fargo will maintain only a minority equity stake.
Particular areas of focus include analytics, big data, credit, deposits, marketing, mobile, payments, security, robotics, wealth management and wearables.
Wells Fargo – Fintech Partnership Examples
In summer of 2021 Wells Fargo Auto partnered with fintech AutoFi to expand its digital capabilities and better serve consumers online. AutoFi’s platform allows Wells Fargo Auto to work with consumers to deliver real-time credit approvals, vehicle selection, financing and F&I product purchasing online, according to a Wells Fargo company statement. Another very interesting partnership is the one with Bilt Rewards. Bilt is the leading loyalty program for renters, and the first-of-its-kind co-brand credit card allows members to pay rent and earn points with no transaction fees on rent payments at any rental property in the U.S. Through this innovative new partnership, renters across the country will now be able to earn unparalleled rewards that can be redeemed towards travel around the world, access to their favorite fitness classes, and even credit towards a down payment on a home.
Goldman Sachs – Practical Banking Strategies for Growth
Goldman has its own accelerator platform that aims to support the firm’s long-standing culture of innovation and experimentation and seeds commercial, innovative and growth businesses for Goldman Sachs. Accelerate provides our people with the capital, resources and support to transform ideas into viable new businesses and products for our clients, with a focus on the firm’s growth. Funded businesses focus on building client solutions, leveraging Goldman Sachs’ unique strengths and offering employees the opportunity to work in a fast-paced, entrepreneurial environment. No doubt that this should convince every stock investor of the long term growth of this banking stock!
Goldman Sachs – Fintech Partnership Examples
In September of 2021 Goldman acquired fintech lender GreenSky for $2.24 billion as the investment bank pushes further into consumer finance. The all-stock deal for GreenSky, called the biggest fintech platform for home improvement loans in a release announcing the transaction, is expected to close by the first quarter of 2022.
Truist
Truist also has its own venture firm. They identify, invest in, and look for acquisition opportunities with businesses that help the bank to innovate, grow, and support their strategic direction. In turn, Truist provides companies with the resources and capabilities they need to expand its market, reach, and capital. No doubt that this is a convincing banking growth strategy.
Truist – Fintech Partnership Examples
In spring of 2022 Truist announced “acquired Long Game, the award-winning gamified finance mobile app that is changing the way people save, learn and engage with their finances. Long Game transforms how users engage with their bank by using prize-linked savings and casual gaming to motivate smart financial behaviors and driving new account growth and client retention for banks. Truist will leverage Long Game’s innovative technology to help its clients build long-term financial wellness and advance its purpose to inspire and build better lives and communities.”
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We hope our article gives you a good overview regarding banking strategies for growth in the fintech area which should have a significant impact on all bank stocks growth. It is notable that the big US banks are heavily focused on investing through their own firm which should hopefully pay off and give them a long term advantage in the market.
