Fintech patent competition: fierce, diverse, growing

Among the most watched areas for new patent value is financial technology, covering inventions in areas like authentication, mobile payments and wealth management.

Fintech is among the few bright spots in the patent landscape, with leading banks like JP Morgan, Bank of American and Wells Fargo, and credit card companies like Visa, MasterCard and American Express deeply involved and competing with a broad range of new entrants, including:

• Traditional banking industry vendors such as Fiserve and IBM

• Scores of venture funded start-ups, some supported by former banking executives

• Established technology players such as Apple, Google and Amazon looking to capitalize on their   consumer recognition by expanding into banking and payments.

Close behind is leading Korean bank Shinhan and Bizmodeline Co., Ltd, a Korean company with a total of 2700 patents, 1000 patents related to Financial and Billing, 1400 patents related to Mobile, Ubiquitous, RFID and NFC, 300 patents related to authentication and other technologies. A host of Japanese companies, like HitachiToshiba, Sony and NEC, have become more active in identifying and developing inventions in the transaction space; Microsoft, too.

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“Start-ups, big tech and… banks,” in the current IAM magazine, The Intangible Investor, looks at the diverse competition in this space. (Subscribers can find the piece, which I wrote, here.)

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For more good background, “FinTech: An IP Perspective,” is a comprehensive report from IP research firm, Releclura. It outlines the players in the space and details the patents they have accumulated and in which areas of banking or transaction. The report can be found here.

A summary of the Relecura research compiled by IP consulting firm Aistemos, with charts and graphs, can be found here.

Execs Poised to Profit

According to The Financial Times, former banking executives are all over fintech startups, hoping for a big payout. See “Former Wall Street titans shake-up banking with fintech investments.” 

In the Wall Street Journal, “Banks and Fintech Firms’ Relationship Status: It’s Complicated,” discusses how disrupters and big lenders, often seen as rivals, are finding some success playing together.

Top holders

Fintech upstarts have attracted more than $50 billion in investments on the premise that they will disrupt banking and finance the way Uber or Airbnb have the taxi and hotel industries. But despite a decade of stumbling the banking industry has proven a tougher business to crack than some had thought. The American Banker speculates that the fintech sector may be overheating.

“’It’s too simple to say all these banks are stupid,’” says Qasar Younis, a partner at the Silicon Valley seed fund Y Combinator.

Like Big Pharma

The banks, much like some of the pharmaceutical companies, are smart enough to know that they will not be able to come up with all of the technology solutions they need to succeed, and that they have the capital, markets and regulatory savvy that others need.

For more information, Forbes’ top fintech stories for 2015, go here; their “Fintech 50” also provides a good overview of the up-and-comers, here.

Image source: americanbanker.com; CB Insights; Relecura 

 

About Bruce Berman

Independent IP observer, adviser and author.

3 Responses to “Fintech patent competition: fierce, diverse, growing”

  1. Bruce, nice overview. It would be interesting to see what’s happened in filings over the last two years, post-Alice. We’ll have to wait another year to see the data though because of publication delays. We have seen a drop in the sales rate for Fintech patents – two years ago, they sold well ahead of the market rate, now they sell well behind (45% drop in sales rate)

  2. Thank you, Kent. Do you think the drop in fintech patent sales is attributable to the Alice decision and the increase in IPRs or to a more secular view of software patents in general? Or are buyers more dubious about the prospects of fintech?

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  1. Fintech patent competition: fierce, diverse, growing – ipstrategy.com - May 23, 2016

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