Patent strategies in the age of FinTech: Understanding IP management practices and open innovation across financial institutions

Purpose This study examines the changing role of patent strategies within the financial sector, with a particular focus on the contrasting approaches of traditional banking institutions and FinTech firms and how these strategies shape innovation and competitive advantage in the context of ongoing technological and regulatory transformation. Design The analysis draws on a longitudinal dataset of patent filings from 2000 to 2023, covering six leading global banks, five major credit card companies, and four prominent FinTech firms. Patent indicators such as filing volume, forward citations, jurisdictional dispersion, and ownership transitions are integrated with firm-level financial data, including profitability metrics and structural characteristics, to examine how IP strategies relate to firm performance. Findings The results reveal divergent IP strategies between incumbents and FinTech entrants. Traditional banks primarily employ defensive IP tactics, whereas FinTech firms pursue more exploratory and innovation-driven patenting activity. The analysis also shows that inter-firm collaborations, joint ventures, and acquisitions are increasingly used as strategic tools to strengthen IP assets and enhance competitive positioning. Implications The findings underscore the strategic significance of IP management in the financial sector, not only as a protective mechanism but also as a way to create value, support partnerships, and strengthen competitive advantage. The study contributes to a deeper understanding of how financial institutions deploy IP strategically to drive innovation and growth in a changing market.