Our biggest stories of the past week are …
What amazes me about the banking system is that the banking system does not believe it needs to change. It does not believe it is being disrupted by technology. It is dismissive of many new start-ups and innovators. And it points to past performance for the reasons why.
I presented at a conference in Italy the other day. It was a small crowd of CMOs from the Italian banks, who listened dutifully to the messages. The feedback forms were mainly 8, 9 and 10 out of 10s, but there were two or three that gave me 1 or 3 out of 10. Now I don’t mind that, because I reckon I’m a bit like Marmite.
Building on yesterday’s discussion of Marmite banking, it’s not a simple question of should we be digital? nor a question of where does digital sit? but a question of all digital. Those who ask the first two questions are thinking of digital banking as a channel; those who get the last point, understand. For example, a digital channel debate would go something like: we’re a branch-led bank and digital means mobile social doesn’t it? A digital bank would just say: whether branch, online or mobile, the digital infrastructure provides a consistent experience for all.
I spent some time with a digital bank this week (yes, they do exist!), and one of their slides really caught my attention. The slide was showing what online banking looked like in the 1990s and the point being made was that most banks are still stuck in the 1990s.
I am tempted to write a long and deep blog today about EMIR, the European Markets Infrastructure Regulation, and how the more transparency regulators force into our capital markets, the more likely that banking will move into the shadows. But it's Friday and, having spent most of yesterday at Ladies Day at Royal Ascot (Queen, country and all that), I just thought I would share with you this lovely photo of me and the human cash machine.
I've seen only three companies that really knew how to innovate to win. All three lost their way since, but they all had one thing in common: iterative innovation. Iterative innovation is a process whereby you plan a series of innovative deployments. The aim is to ensure that each time the competition catches up with your innovation, you roll out the next one. This means you are always one step ahead of the chasing pack, and it makes it difficult to be caught.
The major general news stories of the past week include …
Why London is first for Chinese currency - BBC
The world's first clearing centre for China's currency
‘We sold loans no-one could understand’ says bank bos - The Scotsman
The boss of Clydesdale Bank admitted yesterday that selling complex loans to small businesses confused customers and that the accompanying literature “would not pass the plain English test”
Shadow banks step into the lending void - Financial Times
The growth of alternative financiers – less affected by new regulations and free to grab business – is forcing complex choices on traditional banks
Five reasons why you should stay well clear of the TSB float - The Telegraph
Questor editor John Ficenec explains why he will not be buying TSB shares in a hurry
Tesco sounds the death knell for bank branches - The Telegraph
Has the launch of Tesco's new current account removed any remaining hope that face-to-face banking in Britain could be saved from inexorable decline?
Challenger banks: Swedes, retailers and billionaires line up to compete - The Guardian
The big banks' smaller rivals are offering a variety of initiatives and inducements to break in to the market. Will they succeed?
Meet Tesco's new bank manager: but he won't grill you at the branch - The Guardian
… because they haven't got any. Benny Higgins has finally launched the supermarket bank's current account, but it is firmly app-based. Can it challenge the high street's big names?
ICBC to be first Chinese bank awarded UK branch licence - The Telegraph
ICBC, which has assets of more than $3.06 trillion (£1.8 trillion) is on course to become the first Chinese bank to gain a British bank branch licence
ISIS' half-a-billion-dollar bank heist makes it world's richest terror group - The Telegraph
The al-Qaeda splinter grouping made off with £256 million in cash and a large amount of gold bullion from Mosul's central bank during its takeover of the city
HSBC is latest to suspend 'packaged account' sales - The Telegraph
The bank has withdrawn its 'packaged' accounts as complaints from customers mount
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