The Hidden Friction Killing Bank Innovation Before It Starts

Banks do not lack ideas. The real challenge is turning those ideas into production-ready solutions. In many cases, the journey from identifying a problem to implementing a solution can take around 12 months.

In this conversation, Paul Wallis and Lionel Laulhé from Granite MENA, Philip Hughes and Mark Rothwell-Brooks from Verityx, and Barbara Gottardi from Finbridge Global discuss why banking innovation moves so slowly—and how banks, fintechs, and regulators can create a faster, more collaborative model.

The speakers explore a model designed to bring banks and pre-validated fintechs together around clearly defined challenges. The goal is to reduce duplication, provide better feedback, improve customer experience, and move from ideation to adoption more quickly—with 90 days identified as an ambitious long-term target.

Why Bank Innovation Gets Stuck

When people talk about slow innovation in banking, they often point to bureaucracy. That is part of the issue, but the conversation reveals something more specific: innovation gets stuck because too many teams must align before anything meaningful can happen. A new idea may need to move through siloed business units, receive senior-level approval, secure funding, and pass through technology, risk, procurement, and compliance reviews before the work can even begin. As Philip Hughes explains, bringing together siloed businesses and agreeing on the scope can consume months. By the time the process reaches the implementation stage, the original business problem may already have changed. The three points of friction The speakers describe three major friction points:

1. Defining the problem
   Business, IT, and other stakeholders must agree on the same problem statement.
2. Finding the right partner
   Banks need a fair and consistent way to assess which fintech can best address the challenge.
3. Executing the solution
   The chosen partner must be onboarded and integrated within the bank’s architecture, risk framework, data environment, and regulatory requirements.

This is how a promising idea can take 12 months to reach production—or fail to get there at all.

Why the Traditional RFI Model No Longer Works

Barbara Gottardi argues that traditional RFI and vendor-assessment processes are often outdated, particularly for fintech and AI-led solutions. Different departments may ask the same questions repeatedly because they do not fully trust the checks completed by previous teams. Different banks may also assess the same fintech in completely different ways. For fintechs, this creates a frustrating process of repeated questionnaires, meetings, and long periods without feedback. A company may spend months pursuing a bank opportunity only to receive a vague rejection at the end. A better approach is to standardize the initial assessment so banks can compare providers more objectively and fintechs can be judged on their actual capabilities and fit.

Why Fintechs Need Better Access

Paul Wallis highlights another major challenge: many fintechs have strong products but lack access to the right people inside banks. A fintech may spend months trying to secure meetings, only to present to people who are not decision-makers. A structured innovation platform can act like a “mini showroom,” allowing fintechs to demonstrate their solutions to relevant banking stakeholders. That creates a fairer route to market. Instead of relying mainly on personal networks, the focus can shift toward the quality of the solution and its relevance to the bank’s challenge.

Philip Hughes adds that fintechs must also understand what it takes to operate inside a bank. A strong product is not enough if the provider does not understand banking processes, technical requirements, and internal decision-making.

Why Pre-Validation Changes the Game

A central idea in the discussion is pre-validation. Instead of allowing every fintech to enter a bank conversation without prior assessment, the program can validate providers before they reach the room. This helps establish whether they are capable of executing and whether they fit the bank’s guardrails. Pre-validation benefits both sides:

• Banks spend less time screening unsuitable providers.
• Fintechs receive faster feedback.
• Both sides avoid unproductive meetings.
• The conversation starts with greater credibility.
• Stronger solutions have a better chance of reaching decision-makers.

Mark Rothwell-Brooks and the other speakers emphasize that the goal is not simply to find any fintech. It is to identify providers that can realistically solve a particular banking challenge.

Feedback Should Come Faster

The participants also discuss the importance of timely, useful feedback. Too many fintechs are left waiting for months before receiving a decision. Even when the answer is no, an explanation can help the fintech improve its offering, adjust its plan, or focus on more suitable opportunities. Clear feedback benefits banks too. It creates a more transparent innovation ecosystem and reduces the likelihood that the same unsuitable proposals will keep returning. Faster innovation is therefore not only about making decisions more quickly. It is also about communicating those decisions clearly and constructively.

Solving Shared Industry Problems

The conversation makes a strong case for moving beyond one-to-one innovation and toward industry-wide problem solving. Some challenges are not unique to one bank. Fraud, mule accounts, onboarding, and regulatory compliance can affect many institutions at the same time.

Mark Rothwell-Brooks uses mule accounts as an example. If one bank develops a solution independently, the problem may simply move to another institution. A coordinated industry response could address the underlying issue more effectively. That does not mean every bank must use exactly the same system. Each institution will still have different architecture, risk requirements, and customer needs. However, the core problem can be addressed collectively, with solutions adapted for each organization.

The Role of Regulators

The speakers also consider the role of regulators. Regulators can help define expectations, establish guardrails, and encourage collaboration. However, the actual innovation should come from banks and fintechs working together to solve specific problems. A healthy model gives each group a clear role:

• Regulators
  set expectations and provide oversight.
• Banks
  define the business challenges.
• Fintechs
  provide specialist solutions.
• Customers
  benefit from better products and services.

Why “Best Fit” Matters More Than “Best in Class”

Barbara Gottardi makes an important distinction: the best fintech is not necessarily the one that is universally considered the best. It is the one that is the best match for a particular organization. That fit may depend on:

• Architecture
• Risk requirements
• Culture
• Team capabilities
• Regulatory expectations
• Customer needs
• Implementation complexity

A smaller, specialized provider may be more suitable than a large vendor if it can solve the specific problem more effectively. This also opens the door to modular solutions. Rather than forcing one vendor to provide every capability, banks can combine several specialist providers into one coordinated package.

A Four-Step Model for Faster Innovation

The discussion points to a four-step model:

1. Agree on the challenge
   Define the problem clearly and align the relevant stakeholders.
2. Identify the best-fit provider
   Use an objective and standardized method to assess fintech capabilities.
3. Validate the solution in context
   Test it against real data, technology, customer, risk, and regulatory requirements.
4. Prepare for adoption
   Build the evidence and business case needed for implementation.

This model shortens the distance between an idea and a production-ready solution. It replaces repeated handoffs with a more focused and collaborative process.

Key Takeaways

• Banks often have an execution problem rather than an idea problem.
• Siloed decision-making can delay innovation before technical work begins.
• Traditional RFI processes are often too slow for modern fintech partnerships.
• Pre-validation can improve trust and reduce wasted time.
• Fintechs need access to the right decision-makers, not just more meetings.
• Faster, clearer feedback benefits both banks and fintechs.
• Shared industry problems should often be solved collaboratively.
• The right partner is the best fit for the bank—not necessarily the biggest provider.
• A structured process can help reduce the journey from ideation to adoption.