Citizens' payment exec on how banks can coexist with fintechs

• Key insight: Payments veteran Matt Valente has joined Citizens to help lead business payments and partnerships. 
• Expert quote: "Embedded finance for us is central to meeting clients where they are. It's the best of both the banking and fintech worlds."---Matt Valente, Citizens. 

As banks and fintechs battle for business banking revenue, Citizens' Matt Valente says there will always be an advantage for merchants in having access to a traditional bank.
"You can have a point solution from a fintech. But when you can offer a breadth, such as lock box, ACH, cards, payments and banking, there's a strength in that,"  Valente told American Banker. 

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Valente in early October was appointed senior vice president and head of strategy, innovation and partnerships for Citizens, responsible for helping the bank develop products for treasury and wholesale payments. Those duties include technology development, where, like most banks, Citizens is weighing when to compete with or partner with fintechs. There is space for both options, he said. 

"As we evaluate where there are gaps, there will be areas where we'll want to invest and there will be a partner option," Valente said. "That is what we're taking to the executive teams and the bank's board." 

Embedded opportunity

One area where there are opportunities to collaborate with tech firms is in embedded payments and finance, or placing a checkout function directly within a non-financial app. Valente said the bank will seek to mix its own work on embedded payments with technology partnerships. The banking industry in general is lagging merchant demand for embedded payments and embedded finance, creating opportunity for payment fintechs to step into the market. 

Citizens recently developed an open banking application programming interface to support data sharing between customers and third parties, a key element in supporting embedded finance. It also launched account-migration capabilities within its mobile app to let customers move billing, subscription, and payroll information from other institutions. Other banks are also using embedded payments to broaden their appeal to businesses. Huntington, for example, recently partnered with fintech Payabli to support embedded payments, to help Payab-li counter fintechs such as Ramp and Brex, which also sell to businesses. 

And among larger banks, Truist recently signed a deal with data technology firm Plaid to expand the bank's open banking strategy, including more products and security controls. 

"Embedded finance for us is central to meeting clients where they are," Valente said. "It's the best of both the banking and fintech worlds."

More tech

Valente has started his new job at Citizens amid several initiatives designed to keep the bank competitive in digital assets, AI and international payments.

Citizens has spent the past year building infrastructure and products before it rolls out new bank products to corporate clients in 2027, with cross-border payments and money movement, especially in emerging market corridors, being among the first uses. 

It's part of a broader transformation initiative called "Reimagine the Bank" that includes deploying generative AI, AI agents and enterprise automation to reduce manual work involved in data collection, improve ties between vendor contracts and desired outcome, automate call centers and introduce advisory tools. Citizens projects that by late 2028, "reimagine" will produce $450 million in benefits, with two thirds coming from cost savings and the rest from new revenue. 

In digital assets, Citizens recently joined Open Standard's Open USD stablecoin consortium alongside nearly a dozen U.S. banks. Citizens is preparing to test corporate digital-asset use cases in 2027, including cross-border payments, emerging market remittances, digital wallets and interoperability between decentralized ledgers and traditional corporate structure.

Analysts have praised Citizens' technology investments. Analysts at Raymond James, for example, in a research note said Citizens' "Reimaging the Bank" is contributing to an improvement in the bank's overall financial performance, which is "expected to support positive operating leverage and narrow the profitability gap against peers."

Competition

Before joining Citizens, Valente was most recently at FIS, where he was senior vice president of corporate strategy, covering banking, payments and capital markets. He also held several leadership positions at JPMorganChase, including API strategy, open banking, trade finance, payment modernization and commercial banking. 

"I come from both the bank and fintech worlds and the competition has always been there," he said. 

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In some ways banks are on the defensive when countering fintech influence.For example, banks are lagging fintechs in AI development. While fintechs make up 40% of the data set of recent McKinsey research on AI projects in financial services, they make up 70% of the AI initiatives. 

"Despite their scale and data advantages, incumbent banks trail fintechs in deploying AI with measurable business impact," said McKinsey, which studied 4,000 banks and fintechs.