In the corporate treasury world, large global banks have long been considered the go-to partners. They bring a reputation for stability, deep balance sheets, and an established track record. But in recent years, fintechs have emerged as serious challengers, offering nimble, innovative solutions that many traditional banks simply can’t match. So, here’s the question: Are treasurers limiting themselves by sticking to the perceived safety of big banks, or is it time to rethink the role fintechs could play in your treasury strategy?

Beyond Safety: What Really Matters?

Yes, safety and stability are key priorities, but they shouldn’t be the only factors in the decision-making process. Treasury teams also need functionality, speed, and solutions that solve real-world challenges. Here are some areas where fintechs might outshine their larger counterparts:

  1. Innovation and Agility
    Fintechs are often quicker to adopt cutting-edge technology—whether that’s AI-driven cash forecasting, real-time payment solutions, or dynamic FX risk management tools. They’re not bogged down by legacy systems or layers of bureaucracy, which allows them to bring new ideas to market faster.
  2. Specialized Offerings
    Unlike traditional banks that aim to be everything to everyone, many fintechs focus on specific treasury pain points. Whether it’s streamlining KYC processes, simplifying multi-currency payments, or offering greater transparency in FX pricing, these niche solutions can fill gaps that banks overlook.
  3. User Experience
    Fintechs often prioritize intuitive interfaces and customer-centric design, offering platforms that are easy to use and integrate with existing treasury systems. This can save valuable time and reduce the learning curve for treasury teams.
  4. Cost Efficiency
    Fintechs typically operate on leaner models, which means they can often provide competitive pricing compared to banks. From transaction fees to subscription-based platforms, their pricing structures are designed to be accessible, especially for mid-sized organizations.

The Case for Big Banks

Of course, big banks bring undeniable strengths to the table:

  • Trust and Longevity: With decades (or centuries) of experience, banks have built a strong foundation of reliability.
  • Global Reach: For companies operating across borders, big banks’ international networks and relationships can be invaluable.
  • Comprehensive Services: Banks offer one-stop-shop solutions, from cash management and trade finance to credit facilities.

What’s the Right Balance?

Treasurers don’t need to choose either banks or fintechs. In fact, the best approach may lie in diversifying partnerships to get the best of both worlds. For example:

  • Use fintechs for specialized, high-tech solutions that address specific needs, such as real-time cash visibility or streamlined FX execution.
  • Leverage banks for large-scale operations, such as credit lines, long-term financing, or managing global accounts.
  • Push both your banks and fintech partners to collaborate. For instance, some banks now integrate fintech solutions into their ecosystems, offering the agility of fintech with the security of a bank.

Your Turn

  • Do you believe fintechs are a viable alternative to big banks in treasury operations? Why or why not?
  • Has your organization partnered with fintechs, and what was your experience?
  • Where do you see the biggest opportunity for fintechs to disrupt traditional banking services in treasury?

Let’s open the discussion!

To spark the conversation, we’ll include comments from our board members and insights from treasury vendors and fintechs already disrupting the space. Watch this space for their thoughts—and add your own below!

Dan Kindler, CTO and Co-Founder at Bound, comments:

I don’t see this as an either-or situation. Especially not for larger corporates.

Many already use fintechs alongside their banking relationships – and I don’t see this trend slowing down.

The banks handle the corporates’ core cash and liquidity needs while fintechs offer specialised tools, like automated FX hedging, that help them manage their day-to-day treasury operations more efficiently.

Think of it this way: banks are like the solid foundation of a house – essential, reliable, built to last. We’re more like the smart home system, adding layers of automation, control, and visibility that make everything work better together.

Eleanor Hill, Freelance Content Creator at Treasury Storyteller, comments:

The tide is changing. I see many more treasurers working directly with fintechs these days. By ‘directly’ I mean not through a bank collaboration with a fintech (partnership being the ‘safer’ route).

Of course, the appetite for direct fintech relationships varies according to the size and maturity of the corporate, but it also differs quite significantly by geography. In India, for example, there is huge appetite among the treasury community for fintech solutions. To the point that many treasurers say they would be happy to spend as much on fintech solutions as a TMS (audience poll conducted by me at Treasury Khazana 2024 Conference).

That fintech versus traditional tech space is perhaps where the most interesting battles are still to unfold.

Lorena Pérez Sandroni, Head of Treasury at PayU GPO, comments:

Fintechs are considered a viable alternative to big banks in treasury operations because of their innovative solutions and agile development processes, which allow them to quickly adapt to market and business needs. Specific partnerships with fintechs cannot be disclosed for obvious reasons. However, the biggest opportunity for fintechs is seen through collaboration rather than disrupting traditional banking, as the main challenges for fintechs are linked to regulatory compliance.

Join our Treasury Community

Treasury Mastermind is a community of professionals working in treasury management or those interested in learning more about various topics related to treasury management, including cash management, foreign exchange management, and payments. To register and connect with Treasury professionals, click [HERE] or fill out the form below to get more information.

0
0

Leave a Reply