Take Truly Innovative Programs to Banks
Aaron Huang, Head of Commercial at Productfy, on choosing the right fintech customers
The key point is that the most novel fintech products stop looking like software integration problems and start looking like bank formation problems. A standard BaaS platform is built to help many fintechs launch the same few account, card, and payment patterns quickly. When a startup is inventing a new program shape, it usually has to win bank buy in, design the legal structure, and fund the compliance work itself, because no middleware platform wants to spend heavily on a use case that may stay small or too custom.
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BaaS platforms make money by standardizing repeatable workflows, KYC, account opening, card issuance, and transaction processing across many customers. Thin margins and shared interchange leave little room to underwrite bespoke product design for one early customer.
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That is why Aaron Huang frames direct bank outreach as both offense and defense. The startup keeps control of the program design instead of teaching a platform how to package the idea, while also owning the legal memo, compliance process, and launch economics that make the product possible.
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The market has since moved even further toward direct bank relationships for serious programs. Column and Lead Bank win by putting charter, ledger, payment rails, and compliance under one roof, which reduces the coordination pain of a three vendor stack and makes custom programs easier to operationalize.
Going forward, the split in fintech infrastructure gets clearer. Vanilla debit, prepaid, and account products will keep flowing to packaged BaaS platforms, while differentiated products will increasingly be built around tighter bank partnerships or vertically integrated bank tech stacks. The more a fintech needs special policy, pricing, or risk treatment, the more strategic the bank relationship becomes.