Banks vs Fintechs: The Innovation Gap | Mambu’s Banking Insights for Growth

Joud Zaumot, Solution Engineering lead for EMEA at Mambu, and Andrzej Szelemetko, Senior Solution Engineering at GFT, who discuss how legacy core banking systems are more than just outdated, they’re actively slowing banks down and increasing operational risk.

Zaumot points out that maintaining legacy technology stacks is expensive and inefficient, with a shrinking talent pool that has knowledge gaps. Szelemetko echoes this, sharing how many traditional banks are locked into rigid and slow release cycles, sometimes just four releases a year, while fintechs are deploying updates weekly or even daily.

Gen Z’s growing presence in the workforce adds more urgency as for financial institutions they expect a mobile-first, seamless, and hyper-personalized experiences. As Szelemetko puts it, they’ve grown up with smartphones and expect their bank to have the user experience of the likes of Uber or food delivery apps with invisible or embedded banking being the future, enabling banking services integrated into everyday customer journeys, without needing a separate app or interface. In short, if it takes too many clicks for Gen Z, they’ll switch.

Fintechs, by contrast, build for agility with Zaumot highlighting the digital banks cloud-native approach, API-first design, and focus on partnerships. Instead of building everything in-house, fintechs like Tyme Bank have extended reach and functionalities through strategic alliances.

Both stress that banks are sitting on large amounts of valuable customer data, but struggle to leverage it into meaningful actions. Newer core banking platforms stream and expose data in real time, enabling personalization, faster decision-making, and better UX. However, tailoring the banking experience not just for segments, but for individuals can be something as simple as surfacing the most-used feature on a user’s app homepage as a powerful differentiator.

Collaboration is key as Zaumot references ABN AMRO’s “dual core” model, powered by Mambu, as an example of how banks and fintechs can partner to deliver value while Szelemetko notes examples like BIK in Poland, opening up data for fintechs to build on. It’s about using fintech innovation to enhance banking, not compete with it.