Are Fintech Standards Fit For Purpose?

Hey all, Jason here.

Something the banking industry has been struggling with since the emergence of fintech is how to evaluate, onboard, and manage fintech partners, particularly those that are early stage, often unprofitable startups.

As bank-fintech partnerships multiplied, so did the problems, eventually gaining mindshare with regulators, leading to more than a dozen fintech-related consent orders in recent years.

A variety of proposals for how to simplify and improve bank-fintech partnerships have been floated, including the idea of “standards.” The topic has gained renewed attention following reports that the FDIC is working with bank and fintech trade groups to setup a standard-setting organization.

But are fintech standards fit for purpose? That’s a major theme in this recent discussion I had with Alex Johnson, creator of Fintech Takes, and Jason Henrichs, CEO of Alloy Labs.

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