This data suggests that the survey’s respondents fall primarily into two groups: those that are committed to navigating uncertainty in the pursuit of innovation and those that are more wary. There are undoubtedly several defining characteristics that separate these two groups; for example, those in the former group are probably more progressive to begin with, while those in the latter may be more traditional in their thinking. Most likely, though, the biggest difference between these two groups is how they handle strategy.

In the early 2020s, innovation was hot. Then, in 2023, we saw several banks collapse and numerous consent orders. Innovation efforts retreated. As the new administration prepared to take office at the end of 2024, enthusiasm rose again. And now, against an uncertain macroeconomic backdrop, we’re once again hearing murmurs of reluctance. If this feels like a yo-yo, that’s because it is. As we’ve talked about before, this swaying in the wind tendency (which 51% of respondents seem to exhibit) can hurt growth efforts long term. In short, stop-start-stop-start means little progress.

“Regulatory uncertainty will always be part of the financial landscape, but it shouldn’t stall innovation,” Remy Carole, chief operating officer at Treasury Prime, told CCG Catalyst. “The most forward-thinking banks are navigating this by choosing fintech partners that prioritize compliance and by embedding risk management into their infrastructure. Banks must also over-communicate with their regulators — helping them understand what they’re trying to do, why it’s good for their customers, and how they’ll innovate safely.”

About half of the institutions surveyed are in navigation mode. That is apt to be because they are taking a methodical approach to their business, which allows them to push through to tactical decisions without getting knocked off course. Essentially, these banks are probably very good at determining what makes them unique and crafting strategies that double down on those strengths. As such, when things get tough, they are more likely to weather it. If you’re confident in your plan, you’re less likely to throw it out.

It all really comes back to who you are/want to be as a community bank. It’s about identity. As humans, when we know who we are, it is much harder to push us around. It’s the same way in business. So, for any institutions that fall into the “stalled innovation” camp, try going back to the basics. Create a foundational vision that your employees and customers can buy into, one that can withstand turbulence. From what we’ve seen, the banks doing that are not worried about survival; they are excited about the future.