To trust or not to trust (the fintech industry)? That is the question [inglese]


In the wake of recent industry news of the “German startup massive communication failure” and the “US lending platform ruckus”, I was left pondering is there is such thing as trust in fintech industry overall.

When you read about what is happening with Number26 with its hundreds of unexplained or badly explained accounts cancellations ( or the recent hard stumble of Lending Club (, you can’t help but agreeing with the famous saying “Trust takes years to build, seconds to break, and forever to repair”.

Somebody said that if you believe in efficient markets (or semi-efficient for what matters) you should believe that despite “hiccups” here and there, the fundamentals with remain strong and, provided the right level of regulations, they will ultimately create a trustworthy system. I think this can be true, but we are far from being there, yet.

As an industry, financial services have historically been blamed of not being transparent enough and being as far away as possible from the customer side. Nevertheless people still trust (to a certain extent) financial institutions with their money, and in the last decade or so, started trusting financial services startups too.

I am not looking at this bad news (and others that will surely follow) from a regulation standpoint, or an entrepreneurial/funder point of view, but simply from the customers’ overall prospective.

Building trust in the fintech industry is no walk in the park: it takes years, as the saying goes, and specific behaviors and activities that will be the object of another in depth reflection shortly. But for now I want to focus on the overall trust in fintech, to state that in my opinion there can’t be such thing as an “industry level of trust”.

Financial services startups by definition have to be bold and dare going against the status quo, although of course it would be advisable that in doing so they still retain the safety and best practices expected when you deal with people money and finances. And by being bold and disruptive, they will surely at some point or another incur in some mistake, they all did and will do, it’s in the cards and part of the business.

As I don’t think we can really build an overall “trust” in the fintech industry, what we are left with is building trust in each of the services and companies out there, especially in the best known and visible ones: one by one, step by step, leveraging the good that is in each of these companies and products and making sure that their customers are taken care with the utmost respect and dedication.

It is therefore necessary for all the players in this arena to take a step back and realistically and honestly evaluate how they are building and sustaining customers’ trust:

 If fintech startups follow some or all of these points, they will stand a chance to achieve some level of trust that increases with every interaction their customers have with them: the whole of their customer base over time will trust them to begin with, and then expand cautiously their trust to some other company and service provider in that area, despite the inertia that is one of the two main hurdles when switching to new products and services in every industry and especially in finance and banking. The other factor being, guess what, trust.[1]


[1] Based on the “Consumer Engagement in the Current Account Market” report by Bacs Research and the Bristol University, March 2016 (