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As the financial services industry grows increasingly crowded and end users demand more control over their data, credit unions struggle with the best path forward. Options like banking as a service and open banking have been presented, both with inherent flaws that are detrimental to all parties involved – financial institutions, fintechs and members. However, there is another route that can be mutually beneficial to all: Collaborative banking.

Unlike banking as a service, which requires fintechs to jump through regulatory hoops, and open banking 1.0, which pits credit unions and fintechs against each other, collaborative banking is a model that allows credit unions and fintechs to finally join forces, sharing business opportunities and empowering the member with greater control and choice. It incorporates the spirit of open banking but mitigates the risks and downsides, accelerating growth and innovation for the industry as a whole. However, it requires a major shift in thinking.

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