Banks may look to acquire fintechs to fuel growth, build upon lagging technology and recruit top talent, but before dipping their toes into the fintech acquisition pool, banks should consider their end game strategy.
In an interview with Bank Automation News, our Jonathan Shiery explains how fintechs are being snatched up by banks for a variety of reasons. “Acquiring fintechs helps banks, small and large, to save time developing technology associated with increasing productivity or competing in an innovative way.”
However, for smaller banks, it’s more challenging to acquire a fintech because they have less to spend and there’s less room for error, Shiery explained. “Community and smaller banks should be prepared for hidden costs and dyssynergies that may occur after a deal is made.”