// TECH TRENDS //

None of this is beyond traditional banks ’ capabilities , so why don ’ t they offer it ? The answer ’ s simple : they don ’ t think it ’ s worth it . On a purely balance-sheet level , they ’ re right : the large majority of ‘ tradbanks ’ are simply not set up to support the specific needs of the digital business ecosystem , especially when it comes to offering overseas payments in all the major ( and many

DIGITAL BUSINESS HAS MOVED ON IN THE MANY YEARS SINCE OPEN BANKING WAS FIRST MOOTED . WHY HASN ’ T THE BANKING INDUSTRY ?

minor ) markets around the world . Developing the required systems and processes , employing the right people and forging the necessary relationships – this all demands a significant investment in time , effort and capital .

It may not seem to make financial sense for traditional banks to reorganise their operations to serve today ’ s relatively modest market of smaller , digital enterprises with global ambitions . These businesses need not worry too much , since they can now choose from a range of emerging FinTechs that can serve their needs for fast , reliable and affordable international payments across a range of currencies . In part , that ’ s

because these new financial services providers are not encumbered by legacy systems ; more importantly , they ’ ve been set up specifically to serve the needs of international digital businesses .

Traditional banks can say they ’ re sanguine about these specialist providers , and that there ’ s more than enough room in the market for FinTechs serving ‘ niche ’ markets . That will only remain true , however , if digital , cross-border businesses remain a relatively small segment of the wider business ecosystem . And that ’ s a very big ‘ if ’. To take just one among a myriad of factors , the supply chain chaos of the pandemic forced businesses of every size to re-examine their supply chains and seek out new sources of both sales and suppliers .

Banks can continue to trumpet their open banking credentials , but if they don ’ t provide truly international services , these claims will ring hollow to the growing community of digital businesses that see opportunity beyond their own borders . The industry should therefore prepare for one particularly awkward question from their SME customers in the years to come : “ We ’ re international . Why aren ’ t you ?” �

BANKS CAN CONTINUE TO TRUMPET THEIR OPEN BANKING CREDENTIALS , BUT IF THEY DON ’ T PROVIDE TRULY INTERNATIONAL SERVICES , THESE CLAIMS WILL RING HOLLOW TO THE GROWING COMMUNITY OF DIGITAL BUSINESSES THAT SEE OPPORTUNITY BEYOND THEIR OWN BORDERS .

Intelligent SME . tech

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