Wells Fargo Innovations in Banking to Compete with Fintech

Traditional banking typically stays relatively quiet on fintech developments. We see emerging fintech startups like Square and Stripe speed ahead in providing capital to emerging businesses, simplify payment processes, and provide better user experiences in sending money in a peer to peer manner.

Banking giants may not feel the need to move quickly due to their many advantages. But fintechs aren’t chopped liver either. While they may have been niche at first, they’ve changed up and now are becoming part of the majority. More fintech startups are stepping to tackle each aspect of banking.

Here are just a few of these examples:


Square serves merchants and consumers.

For Merchants

The fintech startup provides simple card readers that allow anyone to connect and process credit card payments from their phones. It recently rolled out Square Capital to lend to small and growing businesses, addressing the small business capital crunch. Finally, it meets merchants where they’re at and helps to set up e-commerce solutions (from websites to simple payment processing).

For Consumers

Square brings simple and intuitive interfaces for users to accept and send payments quickly and easily. Cash App lets users accept direct deposits and payments right to their Square Cash app account, making banking simple. Square Cash even comes with a debit card that provides Cashback on select purchases across different categories.

The firm rolled out bitcoin trading in 2017 and scaled it further in 2018.

The only thing it doesn’t provide is nominal interest (0.05% or less) on Cash held in Cash App accounts.

It is testing out potential zero commission trades to bring about brokerage services, providing a full end-to-end platform its consumers. From value storage to acceptance of payments, to eventual equities trading, Square aims to do it all.

Square, Inc. is a public company and sees bullish sentiment, for the most part, portraying the significance and growth of fintechs.


Stripe is another payment processing company that has found great value in entering the sector and providing compelling services to its many different merchants. The entity conducts seamless online credit card processing and allows its customers to drill down into the data by leveraging its open application programming interface to create tailored e-commerce solutions.

Customers appreciate the simple stripe API for online-only businesses and restaurants that seek to provide their customers with streamlined experiences. Stripe catered to a key demographic, developers and helped them utilize Stripe to serve customer payment processing needs.

Stripe recently raised $250 million at a $35 billion pre-money valuation; as such, the company is a pretty big deal in the fintech world and will likely prepare for an initial public offering soon.

Fintechs Are Here To Stay

Up and coming payment startups are not just for millennials, generations Y or Generation Z, it’s becoming a strong contender for all demographics.

The rise of applications such as Robinhood, Acorns, M1 Finance, Kabbage, SoFi, Lending Club, C2FO, Creditas, Greensill, PayTM, and Oaktree are just a few more examples of how fintech is changing the face of traditional finance.

It is in this current context that Wells Fargo steps in and hopes to disrupt one growing segment of money transfers.

Wells Fargo Steps Up Blockchain Efforts To Improve Its Cross-Border Money Transfers

The banking titan has notably stated its blockchain-based initiative for cross border money transfers works at a faster rate than the SWIFT system.

This, if true, is a pretty big deal.

Why? SWIFT is used by more than 10,000 financial entities across the world to conduct transfers.

Its payments processing system, Wells Fargo Digital Cash taps into R3’s Corda Enterprise technology to conduct a portion of the transfer process.

“When we move money across the world and we need to exchange currencies, we have to go through third parties such as SWIFT and other banks,” noted Lisa Frazier, head of the Innovation Group at Wells Fargo.

“That’s a long process, and every time there’s a connection with external parties, it takes time and energy and effort.”

Wells Fargo notes that entities would see substantial improvements if they were to use its digital cash system.

Digital Cash should extend its capabilities, providing it with one key improvement, moving funds to more than 15 hours a day, a marked improvement from where it’s at today, a mere six hours of fund transfer time. It wouldn’t have to rely on platforms like SWIFT, it couldn’t simply use its internal system to conduct cross border payments transfers at a higher volume per day.

SWIFT is the go-to messaging platform for international and cross border payments, but improvements such as this one could upend its hold on the industry.

Wells Fargo aims to test the program and deploy it on a small scale by next year. Additionally, Wells Fargo notes that it will hold reserves to match its digital Cash. The company aims to distribute digital cash tokens and create stablecoins and its digital wallets.

Cross border payments are a massive industry, and significant improvements would undoubtedly impact a high number of people.

A Solid Response to JP Morgan, Fintech Startups and SWIFT

We haven’t heard too much about movements from Wells Fargo within the blockchain sector, but this recent move would surely make a remarkable impact if deployed correctly. JP Morgan launched several initiatives with its ties to Quorum, the permissioned Ethereum blockchain, its announcement of the JPM Coin, and other partnerships with blockchain-oriented companies that issues bonds or other assets on blockchains.

Further, JP Morgan is not the only bank leading the charge in implementing digital assets. Signature Bank and True Digital, has created Signet, bringing more than 90 clients onto its platform.

Wells Fargo notes that it has tested blockchain projects with other firms and has tapped into distributed ledger technology within its firm to improve internal processes.

The company sees substantial potential in using blockchain technology to reduce friction and improve customer experience in sending cross border payments. Improving their book transfer process will surely add value to the firm and its many consumers.

Interestingly, Ripple Labs, with its XRP token, exists to act as a better competitor to SWIFT. The firm has partnered with many different banks and institutions across the world in implementing DLT products but still sees push back on utilizing its digital token, XRP in systems.

Meanwhile, SWIFT is also working with R3 Corda to improve its system and improve payment settlement.

Wells Fargo aims to keep its solution internal and tied to its networks.

If Wells Fargo wants to keep its innovations in house, players like Ripple still have the potential to work in other financial firms to improve internal and cross border transfer processes.

The ZB Take

Traditional banking entities face disruption from cryptocurrencies and other fintech firms. DLT and blockchain technology is increasing in use as more firms seek to stay competitive and survive in the face of technological chaos.

About ZB Group

ZB Group was founded in 2012 with the goal of providing leadership to the blockchain development space and today manages a network that includes digital assets exchanges, wallets, capital ventures, research institutes, and media. The Group’s flagship platform is ZB.com, the industry leading digital asset exchange. The platform launched in early 2013 and boasts one of the world’s largest trading communities.

ZB Group also includes ZBG the innovative crypto trading platform, and BW.com, the world’s first mining-pool based exchange. Other holdings include wallet leader BitBank, as well as exchange brands ZBM, ZBX and Korea’s Bithi.

Industry intelligence and standards are headed by the recently launched ZB Nexus who embody the core values of ZB Group and open source their reports and analysis for the public.

Learn more about ZB Exchange by visiting www.zb.com.




ZB.com is the world’s most secure digital trading platform, facilitating the trade and management of digital assets from all corners of the globe.

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ZB.com is the world’s most secure digital trading platform, facilitating the trade and management of digital assets from all corners of the globe.

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