Written by Johnny Ola, Managing Director, Q2 Innovation Studio
Financial institutions (FIs) are under massive pressure to deliver the best and brightest new technology — by shareholders, by account holders, and by the competition. But the industry has provided few solutions to help facilitate this. Resources can be strained, old core technologies are often inflexible, and regulatory oversight can steal your time away. Meanwhile, fintechs are nipping at your heels and constantly solving for niche problems that take away your share of wallet. The innovation backlog is piling up, and FIs have few options for making progress.
FIs are right to feel trapped and fed up with the problem. We are too! That’s why we’re pleased to announce Q2 Innovation Studio, a suite of tools and programs for accelerating innovation that’s designed to smash through these roadblocks and provide a path to differentiated experiences that account holders will love. It lets you work with who you want, when you want, and how you want to extend the Q2 Platform — a truly flexible set of programs designed to put you in control of your own innovation. Through Innovation Studio’s programs, the Q2 Platform is all in your hands.
Why is it important to accelerate innovation?
It’s important for FIs to be able to take the reins of the experiences they provide to account holders. FIs know their account holders best, and what works for one doesn’t necessarily work for others. But generally speaking, account holders want new, powerful solutions, and they want to centralize their financial activities. FIs are well positioned to deliver on these demands — on their own and through key partnerships. And successfully doing so will yield sticky, engaged relationships because account holders won’t need to go elsewhere for the financial services they desire. We’ll cover how FIs can do this in a minute.
First, let’s look at the other side of the equation. Fintechs and other technology providers are able to provide the solutions that account holders desire, and they want to appeal to a focused audience who’s likely to adopt their product. Doing so successfully is what will allow these providers to scale.
It only makes sense to bring these two types of companies — FIs and third-party technology providers — together in a streamlined fashion to provide the services account holders want. But today, these options are limited: build, buy, or partner. You’ve heard it, and probably feel like none of these options meet your needs. As you’ll read below, Innovation Studio improves every one of these options and makes them viable choices for FIs to overcome their innovation backlogs and relieve the immense pressure on their organizations.
How does Innovation Studio accelerate innovation?
Innovation Studio isn’t just a single solution. It consists of four unique programs, each of which is designed to solve different needs for financial institutions and third-party technology providers. Let’s look at them one at a time, and we’ll clarify who the program advantages and how.
Q2 Partner Marketplace
For FIs and third-party technology providers
Partner Marketplace is an app store for financial products within the digital banking channel. It allows account holders to browse and purchase products that they need. And because they need them, if they don’t get them through their FI, they’ll go elsewhere.
Here’s how it works. Third-party technology providers perform a single, standard integration to the Q2 Platform, which makes their product available to all FIs participating in the Partner Marketplace program. FIs then create curated app stores for their account holders from all of these available products. These deployments are happening at a speed that wasn't available before in the industry. Shon Cass, EVP, Integrated Sales and Service for Texas Security Bank, shares this experience about deploying the bank's first product through Partner Marketplace: "It was painless. It was almost so easy; it was scary. With Q2, I’m amazed at how we’re going to be able to leverage technology quicker and better than we could have in the past.”
Not only does the program provide the solutions that account holders want within the digital banking environment they’re familiar with, it generates non-interest income for the FI every time an account holder makes a purchase. And because the audience is focused — they’re already engaged with their finances via a trusted source (their FI) — third-party technology providers have a better chance of making a sale compared with pitching their products on the open market. There’s no reason for FIs not to participate in this program. It’s completely free to the FI, it providers customers the products they need, and it drives non-interest income, engagement, and retention.
Q2 Partner Accelerator
For FIs and third-party technology providers
Partnerships between FIs and third-party technology providers are great — and we believe they’re necessary for both to thrive. Unfortunately, traditional partnership models have inhibited collaboration between these parties. Sales cycles and integrations are long, arduous, and hardly scalable. So we’ve upended the process and created a new partnership system.
First of all, we’ve lowered the uncertainty associated with traditional partnerships by enabling a standard integration for third-party technology providers. Once they’ve plugged into the Q2 Platform, their product becomes available for all Q2 customers to purchase and adopt. It’s a true open platform, where companies are free to integrate and start selling with unprecedented speed.
Currently, Q2 has over 450 FIs using its digital banking platform, and with just a single integration, third-party technology providers have the opportunity to sell their products to all of them. This is a massive change from the traditional model, where a custom integration was required for each sale. This is true scalability.
Q2 Customer Program
Flexibility — that’s what the Q2 Customer Program is all about. It begins and ends with our award-winning software development kit (SDK), which gives financial institutions all the tools they need to deliver unique experiences to their account holders. By creating new features, services, and integrations to the Q2 Digital Banking Platform to suit your account holders’ individual needs, you’re building stronger engagement and creating stickier relationships.
To further enable your FI to succeed, Q2 holds regular training sessions on the SDK. In these sessions, we’ll educate your internal developers and make sure they’re well equipped to deliver on your digital banking vision. It truly gives you the freedom to be the FI you want to be by providing a path to rapid development and unique experiences for your FI, your account holders, and your community.
Q2 Partner Development Program
This program carries a lot of the same benefits as the Customer Program above, the only difference is instead of using internal resources to build on the Q2 Platform, FIs hire third-party developers to do the work. Because Q2 can provide referrals to trusted certified development partners, you can rest assured that your vision will come to life with speed and professionalism.
In all, Innovation Studio is about freedom, choice, and speed. And with Partner Marketplace, it’s about changing the economic model so that digital banking becomes a revenue generating aspect of your company. One, two, or all of these programs may be appropriate for your FI. As true partners, we’re here to guide you toward the programs that make sense for your needs. Here’s what one of our customers had to say about the program:
“Because we were able to leverage the Innovation Studio, the speed to market was transformational. We started to talk in terms of weeks and months instead of years.”
– Thomas Novak, VP & Chief Digital Officer
Visions Federal Credit Union
If you’re a Q2 partner, reach out to your relationship manager. They’ll be happy to walk you through each aspect of the program. And everyone should visit the Q2 Innovation Studio page to learn more. Finally, we’ll be hosting two webinars to help familiarize you with some of the Innovation Studio programs that we urge you to attend: