Motives to Form Alliances for Digital Innovation: The Case of Banks and Fintechs

In times of digitalization, the need for alliances among firms increases due to higher com- plexity and greater dynamics. Digital innovation leads to challenges for incumbent firms in adapting to changing rules set by new competitors and higher customer expectations. However, young firms providing technical solutions for the financial services industry (fintechs) also face difficulties; for instance, in meeting high regulatory requirements. Increasing alliances in the financial services industry can be observed due to shortcom- ings on the side of banks and fintechs. We conducted interviews to examine the motives of these alliance partners. The resulting motives are categorized as matching, comple- mentary, and neutral. We derive practical implications in the form of recommendations for alliances, and deliver theoretical insights regarding criteria for digital- innovation- based alliances