Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/289149 
Year of Publication: 
2020
Citation: 
[Journal:] Small Business Economics [ISSN:] 1573-0913 [Volume:] 57 [Issue:] 3 [Publisher:] Springer US [Place:] New York, NY [Year:] 2020 [Pages:] 1505-1526
Publisher: 
Springer US, New York, NY
Abstract: 
The increasing pervasiveness of technology-driven firms that offer financial services has led to growing pressure on traditional banks to modernize their core business activities and services. Many banks tackle the challenges of digitalization by cooperating with startup firms that offer technology-driven financial services and novel service packages (fintechs). In this article, we examine which banks typically collaborate with fintechs, how intensely they do so, and which form of alliance they prefer. Using hand-collected data covering the largest banks from Canada, France, Germany, and the United Kingdom, we provide detailed evidence on the different forms of alliances occurring in practice. We show that banks are significantly more likely to form alliances with fintechs when they pursue a well-defined digital strategy and/or employ a chief digital officer. Moreover, in line with incomplete contract theory, we find that banks more frequently invest in small fintechs but often build product-related collaborations with larger fintechs.
Subjects: 
Fintech
Strategic alliance
Make, buy, or ally
Entrepreneurial finance
Banks
JEL: 
G21
G23
G34
M13
L26
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article
Document Version: 
Published Version

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