Apr 17, 2018
With extensive experience in corporate growth and financial transactions, J.P. Morgan has long-been known to either invest or partner with smaller organizations that have the potential to make big changes in the industry. Yet, as Chief Information Officer for JPMorgan Chase, Lori Beer, recently discussed with Business Insider, engaging with smaller fintech companies at a very early stage is an effective way to harness true innovation.
Some fintechs are fine scaling on their own, but J.P. Morgan's knowledge and resources can prove convenient for those dealing with issues of company growth and complicated regulations on Wall Street. Beer explains, “In some cases, we saw in the fintech ecosystem that one of their challenges is the size, scale and complexity of a company like JPMorgan Chase. If you're trying to build out something in the wholesale payment ecosystem, you're talking about 200 regulators, $5 trillion dollars we process a day, over 120 currencies and countries. There are multiple layers of complexities considering anti-money laundering rules, fraud requirements and new sanctions. How do you understand that complexity if I'm a startup in the payment space in wholesale?"
For fintechs that are further along, J.P. Morgan may partner with them — Beer noted the bank has done this recently in the anti-fraud arena — or make a minority investment so it can help shape product development to better serve the firm’s business.
Even if J.P. Morgan doesn't ultimately buy or significantly invest, it is still beneficial to start a relationship with fintechs the firm finds promising to think differently about its own products and improve client experience.
Read the full article on Business Insider.