Our main stories this week include …
The world is still very confused about bitcoin. For example, some press are still writing the old stories about the phenomena as an investment: Man buys $27 of bitcoin, forgets about them, finds they’re now worth $886k. It makes for a good headline, but reinforces the view that bitcoin is just some basketcase currency, rather than a currency that should put into a basket of currencies. This will change. In fact, some banks are already starting to say bitcoin good, blockchain good, rather than bitcoin bad, blockchain good.
Looking back on 2015, it’s obvious that blockchain was the big focus as mentioned last week. There were other things though, particularly the increasingly intriguing wallet wars. Mobile wallet wars have been bubbling for a while, with stagnant attempts to achieve something from the likes of O2 and Orange.
Another key development of 2015 has been the open sourcing of bank services. I’ve talked for a while now about Banking-as-a-Service (BaaS) – first blog entry almost seven years ago – and this forecast that anyone in the near future would be able to build their own bank through apps, APIs and analytics. The core of this view was based upon banking processes becoming open sourced through APIs* and, in 2015, it’s finally happening. It hasn’t happened yet – this is an ongoing process – but it is definitely happening and is taking place in three forms: voluntarily, customer demand and regulatory action.
The other big trend in 2015 has been the noticeable move of banks away from Big Data to Data Analytics. Some say it’s all about the Small Data, but it’s more about the Context of Data.
I often say that I’m only known in the Fintech world because I’ve worked in technology in finance all my life and finally someone decided to put the words together and merge them. Like Brangelina, Kimye and Bennifer, Fintech is of the moment. What is emerging in the Fintech world? For me, there are five clear areas of change:
As it’s almost holiday time, I’m going to stop blogging for a while, so here’s the final blog post of 2015 and it’s the ten most read blog posts of 2015. In at number 10:
#10: After the glitch, RBS closes GTS (or how a global bank becomes a national one)
I was surprised to see friend of the Financial Services Club Carole Berndt leave Royal Bank of Scotland (RBS) for Australian shores in January (actually Hong Kong with ANZ). The surprise was that Carole had only moved to RBS to shake up their Global Transaction Services (GTS) business the year before, having been specifically poached from Bank of America Merrill Lynch for the role.
I’ve recently been interviewing a series of innovators and challengers in the banking system, and will publish an interview here on a regular basis with these visionaries. In the first of The Finanser Interviews we talk to Mark Mullen, CEO and Co-Founder of Atom Bank and former CEO of First Direct.
#8: Why would a digital bank have branches? (CheBanca! case study)
I just visited with Roberto Ferrari at CheBanca! in Italy. For those who don’t know CheBanca!, it is the digital first bank launched in 2008 by Mediobanca. Mediobanca provides merchant bank services in Italy and had never had a retail bank before. Therefore, it made sense in the post-meltdown digital age to implement a fintech bank fit for Italy, andCheBanca! claims to be that bank.
Sometimes social media kicks off great discussions about banking. In fact, most of what I learn, collaborate, corroborate, develop, gain, understand and envisage comes primarily through my social network. The latest dialogue that spawns its own blog entry is from the Facebook Group Next Bank …
I had a fascinating discussion about fintech yesterday, and was intrigued with the briefing note for the meeting which said the following: “Fintech is the R&D function of financial services in the digital age….less to do with technology more to do with business model reinvention and customer centric design. Fintech can be categorised as …
I just attended the Global Banking Innovation Awards at the BAI Retail Delivery Show, an annual event that has gained traction and represents banks from all regions of the world. Interestingly, Poland, Spain and Turkey regularly appear, which reflects my view that these are the most innovative Euorpean countries for finance, although France got a shout out thanks to Hello Bank! as did Germany thanks to Fidor.
I’m often asked about how to implement a digital bank? My response is that every company is different, with no two banks the same. Some are evolutionary and try to tinker with the current company structure; some are revolutionary, like mBank, and radically reorganise the current structure; whilst some are transformational, like BNP Paribas and Hello!, where the only way to create the new structure is through the launch of a new bank.
I’m wrapping up predictions for 2015 with a touch on technology in banking, as that’s my space. Although most people are talking about the internet of things and wearables as hot, hot, hot, they’re not. In fact, I was reflecting upon the fact that the biggest game of 2014 was Candy Crush. Before that was Angry Birds. Before that was the Crazy Frog.
Whilst debating whether new fintech startups would eat the banker’s lunch yesterday, I stumbled across a really interesting read by Philippe Gelis, co-founder and CEO of FX firm Kantox. It was so good that I asked Philippe if I could put it on the blog and he kindly agreed. Read and enjoy …
I just picked up Silicon Valley Bank’s latest report on Fintech, and it makes fascinating reading. Here are the headlines: the fourth quarter of 2014 was the busiest time in fintech history, with 214 deals taking place globally …
This week’s major news headlines include …
Santander leads likely bidders for RBS’ Williams & Glyn spin-off – The Telegraph
The RBS spin-off could be sold to a rival bank, rather than being floated on the stock market at the end of this year
House prices ‘to rise 50% in 10 years’ – BBC
The price of the average UK home will rise by 50% in the next 10 years, say trade bodies for estate agents and letting agents.
Banking’s ‘Uber moment’ is already happening — 100,000 bankers lost their jobs in 2015 – Business Insider
The “Uber moment” in finance that the former CEO of Barclays warned about recently is already happening — 11 big banks have cut a combined 10% of their staff this year.
Ex-Wall St stars swap banking for fintech – Financial Times
Big names are busy disrupting their old industry via technology
The computer virus that blackmails you – BBC
Ransomware is becoming the fastest growing form of computer malware, experts warn.
Blockchain believers move into finance – Financial Times
Meet one of the innovators looking at mainstream applications for the infrastructure behind bitcoin
What happens when the US Federal Reserve finally puts up rates? – The Independent
Markets expect the Federal Reserve to increase the cost of borrowing in America tomorrow for the first time since 2006. But some economists are anxious about the consequences. Ben Chu reports
New IT glitch hits RBS’s long-suffering customers hit – The Independent
Its worst IT meltdown was in 2012, when 6.5m customers were left locked out of their accounts for days
Who is responsible for the eurozone crisis? The simple answer: Germany – The Independent
The wrong economic model of the crisis led Germany to insist on tighter fiscal rules which created a second eurozone recession. German influence on the European Central Bank also led it to delay QE for six years, and raise rates during 2011. Finally we saw how the actions taken much
We have never used cheques, say TransferWise founders – The Telegraph
“It only took 400 people to create a product that replaces banks in 52 countries. But we’re just at the beginning.”
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