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Craig Fox

Director of Fintech, Silicon Valley Bank

Fintech has come a long way in the past 10 years and its involvement in our everyday lives has never been greater.

Fintech will become an even more important part of our daily lives as we see a wider adoption of banking as a service (BaaS) and more added-value initiatives such as embedded finance.

Innovation is fuelling fintech’s growth beyond traditional personal finance and Craig Fox, Director of Fintech at Silicon Valley Bank (SVB), says consumer attitudes towards finance and acceptance of fintech have improved over the last 10 years and will continue to do so.

He cites BaaS (the provision of complete banking processes from payment to credit as a service through API-driven platforms) as a game changer.

For example, BaaS is encouraging third-party brands to embed financial services such as loans and mortgages into their own online businesses. This creates a competitive advantage by enhancing the customer experience and generating additional revenue. It is also a way to retain customers and increase their lifetime value to the brand.

“BaaS means brands that are non-financial but trusted by consumers can offer financial products. The area of risk around regulation and compliance is handled by the banking partner,” says Fox.

He cites some examples of big brands that already embed finance products, including Amazon, Apple, Shopify and transport app Lyft.

Consumer attitudes towards finance and acceptance of fintech have improved over the last 10 years and will continue to do so.

Gig economy opportunity

SVB is a commercial bank which partners with innovators and investors, and Fox says fintech is evolving into many other areas to serve broader and changing consumer lifestyles.

These include serving the expanding gig economy where workers have traditionally struggled to access financial products because of perceived job insecurity.

One example is insurance brand Zego, which provides insurance based on usage to drivers working for delivery companies such as Uber, Just Eat and Deliveroo.

Consumer friendly

As customers have become more demanding, fintechs have carved out particular niches for different demographics.

The financial services app Cleo, for example, has helped more than four million people obtain a better understanding of their finances. It uses an AI assistant and is popular with younger people.

Another innovative fintech cited by Fox is venture-backed earned wage business Wagestream. The service is offered as an employee benefit and allows workers to access their money as it is earned throughout the month. This means people avoid having to use other forms of credit including pay day lenders.

“Fintech is part of all our lives nowadays and the whole market has shifted,” says Fox. “The relationship between fintechs and traditional banks has matured too with many more partnerships being put in place.”

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