To survive and thrive, big banks need to collaborate and adapt

IT HAS become so widely accepted that financial technology (fintech) startups are bold, nippy, innovative predators, and the big financial institutions are their lumbering, sclerotic - and probably doomed - prey, that what I am about to say will be seen by many as a shocking heresy.

I believe that some sorts of technological change are better done by the banks themselves. That goes against the belief that large institutions are bad at innovation. And of course some traditional banking functions are being revolutionised by new entrants offering peer-to-peer lending, crowdfunding and money transfer.

But the relationship between the fintech firms and established financial institutions is not one between predators and prey. The big institutions that survive and thrive will be those that see how to do innovation well themselves but are also eager to learn from and collaborate with the best of the startups and established digita…