The Dirty Secret Behind Fintech’s Growth Story
Everyone celebrated when fintech exploded. Suddenly, people who had been invisible to traditional banks, the unbanked, the underbanked, the young, had access to financial products built for them. Apps replaced branches. Speed replaced paperwork.
But here’s what the growth charts didn’t show: a massive number of fintech companies were burning money to acquire customers they couldn’t actually serve profitably. And now the bill has arrived.
Driving sustainable profit in fintech has shifted from a boardroom ambition to an existential requirement. The industry isn’t just competing for users anymore, it’s competing to survive with decent margins intact.
“Data Was Once a Nice-to-Have. Now It’s a Survival Tool.”
That line, paraphrased from Kirill Lisitsyn, CEO of Torus, cuts to the heart of what industry insiders are saying right now. In a recent conversation, Lisitsyn pointed out that eroding margins are forcing financial institutions to be precise, not just competitive, about which customer segments they serve and why. The scatter-gun approach to customer acquisition is over.
This isn’t abstract strategy talk. It translates directly into whether your loan gets approved quickly, whether your card gets declined unfairly, or whether a payment platform can spot a fraudulent transaction before it ruins your weekend.
The Problem With Pretty Dashboards
Breno Oliveira, Chief Product Officer at payabl., put a spotlight on something most fintech platforms quietly know but rarely admit: static dashboards are a comfort blanket, not a competitive weapon.
The real shift is toward real-time decision-making, catching patterns like a spike in chargeback likelihood before the chargebacks actually happen, not after. The technology to do this exists. The obstacle, Oliveira argues, isn’t cost or even capability. It’s organisational structure and the absence of genuine executive commitment.
This matters to ordinary people because the institutions that solve this problem first are the ones that will offer lower fees, faster decisions, and better fraud protection. The ones that don’t will pass the cost of their inefficiency on to their customers.
Legacy Banks Aren’t Dead, They Have Something Neobanks Don’t
Mariia Komissarova, Head of Data & AI Delivery at Raiffeisen Bank International, offered a perspective that challenges the popular narrative that established banks are simply too slow to compete with digital-native startups.
Her argument: trust is infrastructure. For legacy institutions, decades of client relationships represent a deeply undervalued asset that no neobank can replicate overnight. The path forward for traditional banks isn’t to pretend they are startups. It’s to invest in the intelligence layers sitting on top of their data, moving beyond simple big data collection toward systems that actually generate insight, while leveraging the trust they’ve already earned.
Driving sustainable profit in fintech, in this view, is as much about identity and institutional memory as it is about technology stacks.
Don’t Rip Out the Core, Wrap It
Meanwhile, at the Temenos Community Forum 2026, Unnikrishnan Rajagopal, Global Director at IBM, was making a strikingly similar argument about banking infrastructure.
For years, banks were told they needed a “rip-and-replace” approach to modernisation, throw out the old core banking system and start fresh. Rajagopal’s position is that this is both unnecessary and dangerous. Instead, IBM and Temenos advocate for a dual-architecture model: keep mission-critical core data on reliable, on-premises systems, and wrap that core with modern microservices and APIs that handle specific functions like payments or fraud detection.
Using container-based technologies such as Red Hat OpenShift, banks can innovate at the edges without touching the centre. Think of it like renovating a house room by room rather than demolishing the whole building because the kitchen is outdated.
Composability: The Word That Will Define the Next Decade of Banking
Rajagopal introduced a concept that deserves more attention outside of tech circles: composability. The idea is that banks should be able to build their technology stack from interchangeable components, plug-and-play building blocks that can be assembled, replaced, or upgraded independently.
The practical consequence is that a bank can launch a new payment product or upgrade its fraud detection without risking its entire system. For customers, this means banks can actually respond to their needs in months rather than years, and do so without the catastrophic outages that have plagued major institutions during poorly managed system migrations.
This is what driving sustainable profit in fintech looks like at the infrastructure level, not glamorous, but the difference between a bank that can adapt and one that is always five years behind.
The Real Stakes: Your Money, Not Just Their Margins
Strip away all the industry jargon and what this conversation is really about is the quality of financial service that reaches real people.
When a payments company can detect chargeback risk in real time, merchants lose less money, and pass less of that loss onto consumers. When a legacy bank successfully modernises its data infrastructure while maintaining client trust, it can offer better rates and faster credit decisions to people who need them. When a bank builds its tech stack in composable layers, it can add services for underserved communities without betting the entire organisation on a single transformation project.
The fintech companies and banks that crack the code on driving sustainable profit aren’t just winning for their shareholders. They are building the rails on which the rest of us move our money.
The Uncomfortable Truth Nobody Wants to Say
Here is where we take a side: the fintech industry spent the better part of a decade congratulating itself for disrupting banking while quietly subsidising growth with venture capital. That era is over.
The institutions that will matter in five years, whether neobanks or legacy incumbents, are those that treat data intelligence not as a feature, but as the foundation; those that invest in stable, composable infrastructure rather than chasing the next shiny deployment; and those that earn the trust of customers by actually performing better, not just looking better.
Driving sustainable profit in fintech is the unsexy, necessary work that separates the companies building something lasting from those racing toward a very expensive wall.
