By Nilesh Chavda, Digital Strategy Lead, VIP Apps Consulting
I’ve spent my career as a consultant across investment banking, cloud advisory, and most recently lending and leasing. I’ve watched transformation programmes succeed, stall, and get buried across all of them. The real pressure point for senior leaders right now is the transformation programme that’s been “in progress” for three years and still delivered zero change to a single customer-facing process.
That’s the real story of neobanks versus traditional banks. Not disruption. An own goal. And the answer isn’t a new platform. It’s a different kind of leader — one with a different process.
Speed Has Moved On
In commercial lending and leasing, specialist fintechs redefined what good looks like. A facility that used to take weeks of document chasing, credit committee queues, and manual underwriting can now be structured and approved in a fraction of the time. For SMEs and asset finance clients who need certainty fast, that’s the baseline. Everything else is falling short.
Fintechs built this from a clean slate. Modern infrastructure, no legacy systems patched together across a decade of mergers, no internal workflows built around processes older than the smartphone. Critically, data driven decision making was designed in from day one. Every credit signal, client interaction, and transaction feeds a single, connected view that informs faster, smarter decisions in real time. When you build from scratch, speed and flexibility are the starting point, not the destination.
Traditional banks face a genuine structural challenge in closing that gap. Client and credit data is frequently scattered across multiple systems and silos accumulated through years of mergers, product launches, and separate technology investments. Running meaningful analytics across that landscape is cumbersome at best. The ones falling furthest behind are those still insisting the gap is smaller than it is.
Neobanks Still Have Ceilings
The profitability question has largely been answered. Revolut posted $2.3bn profit before tax in 2025. Monzo is targeting a valuation of £6-7bn ahead of a widely anticipated IPO. The financial model works, and traditional banks serve themselves better by acknowledging it.
Where neobanks have not yet moved is into complexity. Their strength remains in current accounts, payments, and unsecured credit — products built for volume and speed. Commercial lending, asset finance, and structured facilities require a different capability set: deep client relationships, bespoke credit structuring, and the balance sheet to back it. That ground still belongs to traditional banks, and it is where the most significant commercial value sits.
Trust reinforces that position. When a covenant breach occurs, a lease restructuring becomes complex, or a credit facility needs renegotiating, clients want an institution with the regulatory weight, balance sheet, and accountability to stand behind the relationship. Traditional banks carry decades of that credibility. In moments of commercial stress, that track record carries real weight.
In commercial lending and leasing especially, relationships still close deals. An algorithm can process an application. Sitting across a table, reading a founder’s situation, and structuring something genuinely bespoke still requires human judgement. That capability lives firmly in traditional banking.
Culture Is the Blocker
Something gets missed in most of these conversations. The technology gap is closing. Cloud infrastructure, open banking APIs, modern data pipelines. Traditional banks now have access to the same tools as fintechs.
The question was never can they transform. It’s will they.
The answer, too often, comes down to culture rather than capability. Transformation programmes launch with CEO backing and a glossy deck, then stall when middle management disengages, front-line staff are left behind, and leadership defaults to familiar behaviour when quarterly targets come under pressure. Strong initiatives die in committee. Improvements that would benefit clients get blocked because they require changing a workflow someone has owned for 15 years.
The solution is structured, disciplined business process improvement. In our work with lending and leasing institutions, that means applying our AMOBI framework to map, challenge, and rebuild the steps that slow commercial credit decisions down. Identifying what exists for internal convenience rather than client value, automating decisions that belong in a system rather than on a desk, and measuring success in time saved and friction removed rather than features shipped.
Data sits at the centre of that work. Where fintechs built with data analytics from day one, many traditional lenders are working with client and credit information fragmented across disconnected systems, making even basic portfolio analytics a significant undertaking. Consolidating that data view is not a technology project. It is a process and governance challenge, and it sits squarely within the scope of meaningful transformation. Most traditional banks carry five to ten redundant manual steps in their origination process that a specialist fintech has designed out entirely. That is a process problem, and process problems require process solutions.
The pattern repeats across investment banking and cloud advisory. The technology was never the limiting factor. Culture and process always are.
The real competitive threat fintechs pose is straightforward. They keep moving forward while traditional banks consume energy arguing internally about who owns the roadmap.
Think Fintech. Stay a Bank.
Diagnosing the culture problem is one thing. Fixing it requires a different way of thinking about how change actually happens inside a large institution.
Traditional banks frame this as a technology competition. The ones making progress have realised it is a process competition. Fintechs win because they build every product conversation around the client journey and work backwards, asking what needs to be true for this decision to take minutes rather than days. Traditional banks tend to start with internal systems, internal risk frameworks, and internal sign-off chains, then find the client experience has become secondary.
Adopting that thinking requires a different question in the room: “Why does this step exist, and what would we lose if we removed it?” In practice, the answer is usually very little. Most legacy process debt persists because the mandate to challenge it has never been given. Applying that AMOBI discipline consistently — across origination, credit assessment, documentation, and drawdown — is where the real competitive ground gets won. Process improvement works best as a frontline competitive strategy, not a back-office cost exercise.
The institutions that make the most progress will be those that develop intrapreneurs. Leaders inside the organisation who carry the urgency of a founder, challenge inherited process the way a startup challenges an incumbent, and hold the genuine mandate to act on what they find. The mindset is borrowed directly from the entrepreneurial world: question the default, move faster than the committee, and treat the status quo as exposure rather than protection. The talent exists inside most traditional banks. The permission structure to deploy it is what needs building.
Coexistence Needs Earning
Fintechs and traditional banks will coexist. The question is on what terms. Specialist fintechs will continue winning commercial clients where traditional banks create unnecessary friction: SMEs, asset finance borrowers, businesses whose deals move faster than a credit committee can convene.
Traditional banks hold a strong position at the complexity end. Large structured facilities, regulated products, and the high-stakes commercial moments where balance sheet depth and relationship continuity are decisive advantages. That position stays strong so long as they actively strip out the friction that surrounds it.
The banks that lead over the next five years will be those that asked why their commercial lending process has twelve steps when four would do, and then gave someone the mandate and the backing to change it. Someone who approaches the problem the way a founder would: with the aim of making the institution sharper than it currently is.
About Author:
Nilesh Chavda is Digital Strategy Lead at VIP Apps Consulting, specialising in lending and leasing technology and operations. With a background spanning investment banking, cloud advisory, and commercial finance, VIP Apps Consulting provides independent technology advisory and has developed AMOBI, a proprietary business process improvement framework applied across lending and leasing engagements.
