FinTechs: Disruptors or Partners in Wholesale Banking?

Fintechs have been shaking up the banking industry for quite some time now, and digital banking is raising traditional banking to a challenge. However, during the pandemic, FinTech companies and traditional banks have become frenemies, as the FinTech solutions for banks have been a savior for many financial institutions with their contactless procedures, digital transactions, etc. But is that all that FI’s have to benefit from?

Plenty of the wholesale banking challenges can be averted with FinTech and an example of that is SME lending. When we talk about wholesale banking, SME (small and medium sized enterprises) lending is one of the first operations that come to mind because of its volume, as SMEs form a significant majority (over more than 90%) of all the businesses globally. However, this volume makes even credit line management alone a harder and more complicated process than a traditional bank can take on on its own.

Now maybe it’s time to see FinTechs not as disruptors, but as partners in wholesale banking, and here is why:

What Are the Challenges in SME Lending?

Running a profitable SME lending business can be difficult for traditional banks because of the fast proliferation of SMEs. In addition, the amount of data required to be collected from them (compared to a retail loan) to fully understand their business, as well as the increased risk makes the whole process overall complicated.

That said, here are some of the other most important wholesale banking challenges that traditional banks face when it comes to SME lending:

The Manual Scoring Mechanism

The scoring mechanism of the applications for a loan is processed manually. This not only consumes too much time and labor, but it also decreases the efficiency of the process.

The Long Decision Making Process

As the scoring is handled manually, so is the decision making process. Therefore the amount of time and manpower spent on the process is not only overwhelming but also because of the huge value of applications, the quality of the process can be compromised.

The Huge Number of Transactions

We have mentioned how SMEs formes a large part of wholesale banking. Because of the business volume that they have, there are too many transactions from too many SMEs. This results in repeating the time-consuming processes too many times. And as we consider that more than 50% of these transactions are denied, the outcomes for traditional banks are nonprofitable.

Lack of Financial Data

The manually operated transactions mostly rely on data that are retrieved manually. This results in not having enough data to have an efficient evaluation of applicants which at the end deeply affects the whole process.

Time Consuming Processes

Generally, the loan decision process takes approximately 6-8 weeks, and 80% of this time is spent on data collection.

How Does Fintech Help?

Fintechs in wholesale banking has proven to help in various ways. Here are the numbers that demonstrate the advantages of financial institutions collaborating with FinTech companies according to a study conducted by Manatt:

  • 59% Expanded Mobile Banking Functions
  • 44% Lower Capital Expenditures
  • 42% Lower Cost of Doing Business
  • 36% Enhanced Brand Reputation
  • 11% Access to Younger Consumers
  • 8% Increased access to Consumers in New Markets

In terms of SME lending, with automation, AI and various other implementations that FinTechs provide, it helps traditional financial institutes to run a much more beneficial and profitable operation.

We Are Here to Help – RISQ | SME lending

At RISQ, we offer products and solutions that carry financial operations to the next level. With our RISQ | SME lending solution, we digitalize SME lending processes from end-to-end and serve a faster, easier and better SME lending experience with lower costs and better risk management.

Contactless SME Lending

The importance of contactless banking has emerged even more during the COVID-19 pandemic. With RISQ, SMEs can apply for new loans from the banks’ banking portal without coming to the branch. This reduces the time spent on data collection by 100%. Plus, financial statements (balance sheet, income and cash flow statements) can be uploaded by the SME itself, giving more time to the bank to process other financial services.

Digital Credit File

Digital means less manpower. The loan application from the portal is converted into a fully digital credit file including uploaded financials, which makes proceeding with evaluating the applications easier. As automated systems convert the data into the bank’s format, it provides a financial analysis including automatically calculated ratios and trend analysis.

Embedded Workflow

An embedded workflow engine will help you with day to day operations and handle any approval process you have in place that day.

Integrated Scoring

Scoring the applications is just as time-consuming as data collection. We offer an embedded scoring engine that saves you time and eliminates the need to recapture data from any other source. It also allows plugging in an existing scoring engine if required.

AI (Artificial Intelligence)

As AI in wholesale banking has proven its importance, our AI-powered solution can forecast the likelihood of loan approval of a new application. Thus, as you can prioritize promising applications and approve them faster, it also tells you which additional data to collect to increase the quality of an application.


RISQ | SME lending can be easily integrated via APIs to your bank’s source systems as well as to local credit bureaus (core banking, treasury application, CRM, etc.) and to external data providers, allowing 100% automation.

Furthermore, our smart finance platform comes with the following features:

  • Multi-node SME facilities & life-cycle management
  • Collateral management
  • Limit & policy rules checks
  • Embedded reports & management charts
  • Multi-device support



Although the traditional banking industry has seen FinTech companies as disruptors and competition to beat for a long time now, the advantages of partnering up with them, or simply using FinTech, is undeniable. Deploying FinTech in your traditional banking operations, especially in SME lending, is not only very beneficial in terms of time, manpower and costs, it is also the best way of carrying your company into the future.

Download RISQ I SME Lending brochure to learn more about our SME Lending product.

Contact us for more information about our RISQ | SME lending solution as well as other products and solutions that will make traditional banking smarter.