The majority of banks felt that the implementation of an institutional FinTech solution had contributed towards achieving business goals by lowering operational costs (87 per cent) as well as improving regulatory compliance (67 per cent).

This is according to a survey carried out among 10 banks and 142 FinTechs by ING UK and Illuminate Financial between December and January 2019, which found that 40 per cent of FinTechs agreed that reducing operational costs was the primary driver for banks adopting tech solutions, followed by improving regulatory compliance (21 per cent).

The survey - now in its second year - also showed that just under a third (30 per cent) of FinTechs believed that the adoption of new technologies is always or often supported at bank management or board-level, compared to half of banks which reported the same.

However, 60 per cent of banks acknowledged that navigating organisational decision-making is a challenge in partnering with a financial institution – although this was an improvement on last year’s 70 per cent. FinTechs do not share the same sentiment, as 65 per cent of them believe this is now a greater challenge, up from 46 per cent the previous year.

Furthermore, 72 per cent of FinTechs said it was either very difficult or difficult to connect with the relevant people in a financial institution, compared to half of banks which agreed – up 10 per cent on 2017.

Luca Zorzino, investment director at Illuminate Financial, said: “Banks recognise that increasing competitive pressures cannot be addressed with legacy technologies and the need to develop product and services that empower customers can only be met by adopting or partnering with emerging vendors.”

The survey results followed the launch of ING’s Innovation Lab in London yesterday, following similar hubs in New York and Singapore.

The London lab is focused on PropTech and RegTech innovation, with the first cohorts of startups starting projects in October.

Annerie Vreugdenhil, head of innovation and wholesale banking at ING, told FStech that an artificial intelligence capability was also being built out in the London office, with data scientists currently being hired to drive this side of the business.

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