Is fintech consumer banking trending toward unbundling into niche, segment-specific products, or toward bundling into broad multi-product super apps?

Harry Stebbings · May 24, 2021

Nearly all consumer credit products — student loans, mortgages, other credit — can and will be bundled by large challenger banks like NuBank and Revolut, which is a concern for single-product fintechs

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Jackie Reses · Mar 31, 2023

There is no broad market for super apps; only a handful of companies have earned the right to build a multi-product consumer ecosystem.

You have to start from a position that gives you the right to those products, and not every verticalized solution does; Cash App and Nubank are rare proof cases.

Scope: a few players like Cash App and Nubank have shown it can be done

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Harry Stebbings · Mar 31, 2023

Consumer banking is unbundling into segment-specific banks (students, immigrants, construction workers) because lending needs, product expectations and service requirements differ sharply by group.

Serving a homogenous mass-market group is very difficult when what he, his mother and his brother want are entirely different.

43:15 Unbundling into segment specific banks driven by differing needs

Jackie Reses · Mar 31, 2023

Fintech oscillates between bundling and unbundling cycles, and we are currently swinging back toward bundling.

Horizontal players like Square get attacked by verticalized solutions such as Shopify, Stripe and Toast, but verticals aren't broad enough on LTV to sustain a market, so players re-bundle.

43:43 Fintech cycles between bundling and unbundling currently swinging to bundling

Jackie Reses · Mar 31, 2023

What separates founders who can expand into multiple products is consumer instinct plus sheer conviction in a hypothesis about the future, executed against relentlessly.

Jack Dorsey refused to leave the office until Bitcoin was built into Cash App despite naysayers, because he had a point of view about the future.

46:12 Founder consumer instinct and relentless conviction not strategy enables successful multi product expansion

Nigel Morris · May 24, 2021

Cross-selling can work in the digital world, and the best challenger banks will make it work — NuBank shows it by offering the right cross-sell product at the right time in a frictionless way

The gap between NuBank's offering and Brazilian incumbents is enormous and its virality index was unlike anything he'd seen; challengers with NPS in the seventies and eighties meet customers where they are rather than dragging them into branches to be cross-sold

35:17 Cross selling works digitally when executed frictionlessly by elite operators