ClearBank, the enabler of real-time clearing and embedded banking for financial institutions, has released research into the attitudes of FinTechs towards agency banks, with worrying implications for long-term relationships.
The report, ‘How well are FinTechs served by banks? The state of agency banking across the UK and Europe’, asked FinTechs across Europe about their relationship with agency banking partners.
The results show a rising indifference to agency banks among FinTechs. While the duration of partnerships remains stable—around four years for larger FinTechs, around two for the smaller— there is a notable decline in satisfaction with agency banking partners. In the last report, half of FinTechs felt that agency banks had helped their business, while a third felt the impact had been neutral. In 2024, those numbers have shifted, with just 29% feeling that the relationship had helped their business, and 61% seeing a neutral impact. For smaller FinTechs, this shift was even more pronounced, with 72% reporting a neutral impact on their business. Meanwhile, negative sentiment was essentially static.
This shift comes at a dangerous time for agency banks, with 15% of FinTechs looking to change provider, with this rising to 23% for mid-size FinTechs. Those who want to switch are planning to do so in the next year, and most who do not plan to switch cite the pain of switching as the reason for staying with their current provider.
Despite it becoming a bigger consideration for FinTechs when selecting a partner, there has been a noticeable decline in the quality of service that FinTechs feel they are receiving since 2020. Satisfaction with the speed, security, reliability and ease of use provided by agency banks have all fallen in the last four years, particularly among larger FinTechs.
At the same time, FinTechs do not see their agency banking partners as a trusted partner or someone who challenges their thinking—a perception that puts these partnerships at risk. In particular, more FinTechs have become unhappy with their banking partner’s ability to enable innovation in their business.
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