Banks need to collaborate with Bitcoin and Fintech developers

Author: Mia

It will take time for banks to change their mindset and embrace Bitcoin or Fintech. Banks need to innovate faster, but they can’t do it on their own. Allowing third-party developers to access banks through API clients alongside banks is a big step forward in innovation, as financial industries like Bitcoin and Fintech can bring valuable benefits.

Banks and other established financial institutions are not yet interested in Fintech and digital currencies because they see these two industries as their main competitors. Although Bitcoin and Fintech can indeed significantly increase corporate profits, they can only be seen as complementary allies that bring success to the banking industry. At least that's what the Monetary Authority of Singapore thinks.

It is undeniable that the financial industry has not had real innovation for a long time, so it needs to be open to the outside world and allow other institutions to participate and bring unique innovations. In fact, many financial experts see Fintech and Bitcoin as two major threats to the banking system, so there are objections to any solution that is not from banks or governments.

But the Monetary Authority of Singapore has taken a different approach because they believe that Fintech and Bitcoin can complement the current financial infrastructure rather than compete with banks. The combination of traditional banking and innovative technology has the potential to create a strong and flexible global financial ecosystem.

Fintech startups and entrepreneurs have earned their name by being unique when it comes to assessing the financial services industry. Especially when it comes to lending and peer-to-peer lending, most Fintech companies are one step ahead of traditional financial institutions, but this does not mean that these startups are plotting to overthrow the banking system, although in the long run, they may have the ability to do so.

In the long run, any bank that is too slow to innovate, or unwilling to innovate, will be overtaken. Partnering with Fintech companies is a good solution, although the banking system may lose some face. Fintech companies are inherently more capable of embracing new and advanced technologies, so they are valuable allies of traditional banks.

A senior official from the Monetary Authority of Singapore said:

The Monetary Authority of Singapore’s attitude towards Fintech is to use the power of technology to help banks succeed. This is not a game of disruptors versus capable people. We see Fintech as capable people… Fortunately, Fintech companies are responsible for creating high-end technology products, and their success lies in cooperating with banks and promoting their success.

But Bitcoin plays an important role in the financial world, even though the system is completely outside the control of banks and governments. Although consumers and businesses have always used traditional financial services, digital currencies are popular in all countries around the world, and the currency supports seamless and real-time transfers.

So far, most of the major banks around the world have tried to ban the use of Bitcoin by developing their own blockchain technology. But the story is not over yet, as some countries are considering issuing their own digital currencies instead of using Bitcoin. It remains to be seen whether this decision will be effective and feasible in the end.

It will take time for banks to change their mindset and embrace Bitcoin or Fintech. Banks need to innovate faster, but they can’t do it on their own. Allowing third-party developers to access banks through API clients alongside banks is a big step forward in innovation because financial industries like Bitcoin and Fintech can get valuable input.

JPM compiled from

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