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The fintech phenomenon in the banking sector has evolved substantially in the past several years. Initially, fintech providers (fintechs) were viewed almost purely as disruptive competition unencumbered by regulation. Today, these firms are viewed differently. While there remains valid concern about disintermediation of traditional financial services by fintechs, there has also been growing recognition that fintech partnerships represent significant opportunities for banking innovation.

This evolution of perspective from competitor to partner has helped drive a massive inflow of venture capital and private equity dollars into fintechs across the U.S. and around the world. In the first half of 2021 alone, the Americas saw $54.1 billion in fintech investment — almost half of the global total.

For banks, the effort to identify valuable and reliable fintech partners raises new challenges. First, identifying and prioritizing the products, services or internal processes that require innovative change is daunting. Second, wading through the landscape of potential fintech partners who can support the business requirements of the bank (which may range from legacy providers to startups with barely a line of code) can take months. Third, overcoming the internal challenges of plugging together new partners with existing core infrastructure can seem impossible.

To help address these challenges, the Missouri Bankers Association launched the first Missouri fintech benchmarking survey in October 2021.

Our findings shed light on the areas in which Missouri banks believe fintech partnerships will be necessary for success in the next three to five years. The data confirms:

1. New fintech partnerships are in play now, but they will be critically important to bank growth by 2024.
2. Online account opening, online lending and fraud prevention will be the most important areas for partnership in the next three years (with cryptocurrency following closely behind).
3. The vast majority of Missouri banks believe they are average at best in their use of front-office, customer facing and back-office technology.
4. Data management and analytics will receive significant focus from the majority of Missouri banks in the next three years.
5. Staff knowledge is a major limitation on fintech implementation, meaning the battle for digitally-savvy talent will become more serious moving forward.

This MBA report that benchmarks fintech across Missouri banks covers the following areas.

• Today's Missouri Banking Experience
• Partnerships
• Where Banks Should Be Investing
• The Cores

As we gather more data, MBA will produce more benchmarking reports for our member banks. Hopefully, these insights help you develop new waypoints on your journey through digital innovation.

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