Some Nigerian banks may resist fintechs because they regard them as competitors who are taking away their customers, but fintechs have a duty to explain to them that this is not the case. Banks have the banking infrastructure which is effectively complemented by fintechs’ IT solutions. Fintechs essentially help deepen the relationships that banks have with their customers by providing complementary services. Fintechs are not banks because they do not hold funds. Customers’ accounts are held in and managed by the banks and the flows through the accounts remain there.
When fintechs connect to banks in Nigeria, that connection is API driven. That means using application programming interfaces to speak to different applications.
Today data is scattered across multiple platforms. A corporate treasurer needs to spend days to reconcile multiple data across various sources. For example, a treasurer may have 15 accounts in 15 different banks, and at any point in time they need to make a decision, underpinned by a view of payables or receivables.
The solution is a single portal that provides treasurers with a single view of what is happening across multiple accounts. It would help them effectively respond to issues and reduce time required for the completion of their tasks such as sourcing data, reconciling multiple accounts and producing instant reports. This is exactly where fintechs can help banks add value for their corporate treasury customers.
Ceviant has created an interface that helps finance professionals handle multiple tasks using the accounts they have created with their banks. When a corporate signs up for Ceviant services, for example, and a bank fears that it might lose its customer, we explain to the bank that this is not how it works. It would even be worse for a bank if it does not integrate because when a corporate feels comfortable on our platform and sees other banks that are already connected to the platform, it may be discouraged by its bank’s lack of connectivity to the platform. In other words, banks can this way drive away their corporate clients that already have accounts with them. We also explain to corporates that we don’t have a connection to their bank accounts, it is the corporates that have the connection to their bank accounts using our platform.
Any bank that is already connected therefore becomes a bank of choice. Once a client is on the platform, it is able to perform various banking and payments transactions on the same platform. That means a corporate treasurer does not need to log out and then open a new bank’s online system that is not on the platform. It is therefore logical and beneficial for a bank that is not connected to the platform to join, so that its own customers could also use the platform and still enjoy banking with their bank.
It will take time for banks to adopt the system but it is important to realise that there is not any competition between banks and fintechs but rather collaboration to deliver innovative digital solutions to customers.