I'm confused by this statement. fintechs aren't just proxies for banks, they're financial products that people want to use. There are plenty of cool and innovative things you can do with just a banking API beyond just creating another bank

Sure the costs for any fintech using these products are the same, but they can offer a million different types of products which make them unique.

Then company underpinning those fintech businesses decides to pull the plug and suddenly everyone finds themselves up in a creek without a paddle.

This is true for basically everything powered by an API.

I mean if you want to start your own bank and deal with compliance then sure do that! I don't see your point here, there is no sensible alternative to this problem.