When to Build, Buy, or Partner with Fintechs

Article

Oct 28

**“The right answer depends less on the technology itself and more on clarity of strategy.”**

OCTOBER 28, 2025

One of the most critical strategic decisions for financial institutions today is whether to build capabilities in-house, buy solutions off the shelf, or partner with fintechs. The right answer depends less on the technology itself and more on clarity of strategy.

In my nearly 30 years of leading and advising financial institutions, I have seen institutions succeed and fail at all three approaches. The difference was not budget or talent. It was alignment between strategy, operating model, and execution discipline.

The Case for Building

Building in-house can create true differentiation when the capability is central to strategy. For example, if data analytics is the foundation of your growth and risk management strategy, then building proprietary tools may be worth the cost and time.

But I have also seen institutions pursue in-house builds for the wrong reasons, such as pride or fear of outsourcing. Too often, these projects run over budget, take too long, or deliver little advantage over existing vendor solutions.

When to Build: When the capability is core to long-term competitiveness and you have the talent and scale to deliver it faster and better than external providers.

The Case for Buying

Buying solutions off the shelf can provide speed and reliability. I have seen organizations implement proven digital banking platforms or compliance systems in months rather than years, allowing them to focus resources on differentiation elsewhere.

The risk is commoditization. If you buy the same solution as your peers, you may meet baseline expectations but you will not stand out.

When to Buy: When the capability is critical for operations but not a source of differentiation, and when proven vendors can deliver it reliably.

The Case for Partnering

Partnerships with fintechs have become the most attractive option for many community banks, credit unions, and regional banks. Partnerships can deliver innovation at scale without requiring full ownership of development. I have worked with institutions that co-created new digital products with fintechs, giving them modern capabilities while preserving their mission and regulatory posture.

The key to partnership is discipline. Too many institutions jump into partnerships without clear measures of success or integration plans. A fintech partner is not a magic solution, it is a strategic relationship that requires governance, alignment, and accountability.

When to Partner: When speed, innovation, and flexibility are needed, and when the fintech brings unique capabilities that align with your mission and strategy.

The Board’s Role

Boards should not simply ask, “Are we building or buying?” They should press leadership to answer:

How does this decision align with strategy and competitive advantage?
Do we have the talent and operating model to succeed in this approach?
What risks and dependencies are we taking on?
How will success be measured and reported?

Boards that frame the conversation around strategy, not technology, help leadership avoid costly mistakes.

The CEO & Executive Team’s Role

For CEOs, the role is to ensure discipline in how these choices are made. That means:

Aligning build, buy, or partner decisions with clear strategic priorities.
Balancing speed with sustainability and risk management.
Establishing governance structures to manage partnerships and vendor relationships.
Communicating transparently with the board about costs, risks, and outcomes.

The best CEOs I have worked with set a clear standard: technology choices are not about chasing trends. They are about enabling strategy.

Looking Ahead

The line between banks and fintechs will continue to blur. The institutions that win will not be those that always build, always buy, or always partner. They will be the ones that make each decision with clarity, discipline, and alignment to their technology landscape and business strategy.