As banks continue to enter into partnerships with fintechs, the risks as well as the benefits of these arrangements are becoming clearer. The
Banks have been increasingly teaming up with financial technology companies to streamline processes like payments, underwriting and app development. Some banks offer banking-as-a-service to fintechs, letting the third parties take advantage of banks' charters and deposit insurance while providing more nimble services to consumers.
Comptroller of the Currency Michael Hsu said in a September speech that
"Much more work remains to be done. My sense is that we are still in the early stages of a significant shift in how banking services are going to be provided in the future,"
Here are some of the biggest risk factors of fintech-bank relationships: