Get the Inside Scoop on BaaS from Deltec Bank, Bahamas

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Get the Inside Scoop on BaaS from Deltec Bank, Bahamas

November 28
16:16 2019
Get the Inside Scoop on BaaS from Deltec Bank, Bahamas

Deltec Bank – Bahamas
According to Deltec Bank, Bahamas-“Fintech companies must pay to access banking systems and data. This will bring in more income for banks that partner with those fintech companies.”

Fintech companies are threatening traditional banks, but these banks are fighting back by implementing Banking as a Service (BaaS). Keep reading to learn more.

What is Banking as a Service (BaaS)?

Ulrich Scholten, a cloud computing researcher, best explains BaaS when he says, “End-to-end process, ensuring the comprehensive completion of a financial service, provided via the Internet on demand and managed within a specified timeframe.”

This end-to-end process, also known as white label banking, opens up the way for fintechs to unite with banks through the use of APIs.  Once connected, fintechs can take full advantage of the opportunities existing in open banking. 

But this partnership benefits the banks too by keeping them from getting left behind and overthrown by fintech companies.  However, staying relevant isn’t the only benefit that BaaS offers to banks. 

According to Deltec Bank, Bahamas-“Fintech companies must pay to access banking systems and data.  This will bring in more income for banks that partner with those fintech companies.”

Chris Skinner explains that these services are paid for, ” as you use them, rather than buying them. These services used to cost you a fortune, but are now free or near enough. That’s where banking is going.”

How Exactly Does BaaS Work?

If you want to better understanding Banking as a Service, you must know how it works.  Here is a brief overview that should give you an idea:

  • A fintech company or another third-party pays for the right to use the BaaS platform.
  • Once paid, banking APIs are opened up to the fintech company. 
  • When opened, banking APIs allow third parties to access the bank’s systems and data.
  • Because of this access, third-parties can develop new products or services for banking customers.

How BaaS Affects the Future

With BaaS platforms becoming more common, consumers will begin to expect this type of data and infrastructure sharing within the financial industry.  Banks that foresee this are developing BaaS platforms before they fall behind the trend. 

Those banks will have a better shot at beating competitors while also earning additional revenue.  In addition, banks will be adequately equipped to adjust for new trends that arise after BaaS platforms have been widely implemented.

Because so many aspects of daily life have been digitized, financial institutions that don’t adopt new technologies are in danger of getting left behind.  José Rider Jimenez, payment service and collection expert, says, “when the payment process or the banking process itself is involved the digital process stops.”

Jimenez goes on to say, “Banks that manage to get involved and offer their services, not necessarily for free, in this new wave of digital services will gain more customers and become more competitive.”

The impacts of current trends extend beyond traditional banks. Because some banks are providing access to their systems and data, more companies are getting the opportunity to offer financial services.

As a result, banking-as-a-service platforms present many new possibilities for banks and third parties. As David Jiménez Maireles, Country Head of Raisin in Spain, says, “this trend will grow even more in the coming years and the banks will focus on this aspect a lot.”  

Disclaimer:  The author of this text, Robin Trehan, has an Undergraduate degree in economics, Masters in international business and finance and MBA in electronic business. Trehan is Senior VP at Deltec International www.deltecbank.com. The views, thoughts, and opinions expressed in this text are solely the views of the author, and not necessarily reflecting the views of Deltec International Group, its subsidiaries and/or employees.

About Deltec Bank

Headquartered in The Bahamas, Deltec is an independent financial services group that delivers bespoke solutions to meet clients’ unique needs. The Deltec group of companies includes Deltec Bank & Trust Limited, Deltec Fund Services Limited, and Deltec Investment Advisers Limited, Deltec Securities Ltd. and Long Cay Captive Management.

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Company Name: Deltec International Group
Contact Person: Media Manager
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Phone: 242 302 4100
Country: Bahamas
Website: https://www.deltecbank.com/