Home / Digital Bank / Bank Fintech worries are obvious … solutions are not as clear

Bank Fintech worries are obvious … solutions are not as clear

I just finished presenting on Digital Bank strategies and Fintech, and was asked a wide range of questions:

  • How do we transform our legacy structures?
  • What is the biggest obstacle to becoming a digital bank
  • You mention partnerships but all cooperative structures failed in the past, how can we succeed in the future?
  • Can you show us someone who is doing this right and making it work?
  • What should a bank do when we have millions of customers who trust us?

… and more.

I kinda realised something at this point that hadn’t struck me before or, rather, it had struck me but not as visibly.  Banks are worried about the future, not complacent. 

I guess that is why I am being paid to talk, consult and write about this stuff, but it didn’t hit me as noticeably as it did today (probably because at most conferences, no-one asks any questions).

One lady came up to me afterwards and said: the problem is we all know we need to do something, we just don’t know what to do.

I said it’s pretty easy, and started re-iterating my underscores about digital needs to be seen as core, not periphery; it needs to be invested as a continuum, not a project; it needs to be seen as foundations of the bank, not a channel of the bank; it needs to be articulated clearly about what it means to the bank and led from the top; etc, etc.

She intervened fast and said: I hear you, I hear you, I hear you Chris, but you don’t get it.


It was then I got the message: Our bank is led by someone who doesn’t get it.  He’s assigned digital under the leadership programs but, when it comes up, you can see he switches off.  All he’s concerned about is regulation and compliance.  Digital is on the back of the bank’s envelope, but it’s not key.

It was then I realised I was talking to the head of digital at the bank.  Oh dear.

I must admit that I encounter this frustration more and more often.  The frustration is that the bank is worried about fintech, has woken up to digital and are thinking about what to do.  They’ve invested in apps and APIs, restructured services, trying to get off legacy and doing the things that should be done.  But the problem is the CEO doesn’t get it.  The CEO has grown up in the bank, understands the bank, loves the bank but has no idea what this digital stuff is all about.

A great example was another conference attendee who runs a group that represents bank thinking.  He said they had created a fintech focus area but were struggling as no-one in the group knew anything about fintech or digitalisation.  Sure, they all knew about bank risk, compliance, counterparty systems and mandates and such like but digital?  Fintech?  Oh no!  Bring in the nerd.

So, I know now something I’ve known before but can articulate better than ever before.  If your CEO is not leading change and articulating a digital vision, then what are they doing?  If they have a team delivering digital change but appear to have delegated their responsibility to be part of that change, thn what are they doing?  If you are seeing inertia and complacency about fintech and digital in your bank, then show them Jamie Dimon’s shareholder letter and scream: WHY?  If you are in a bank that needs to wake up to digital and fintech, then make sure that the CEO is awake first.  Finally, if you are in a bank that has not even got this in their agenda … leave.


About Chris M Skinner

Chris M Skinner
Chris Skinner is best known as an independent commentator on the financial markets through his blog, the Finanser.com, as author of the bestselling book Digital Bank, and Chair of the European networking forum the Financial Services Club. He has been voted one of the most influential people in banking by The Financial Brand (as well as one of the best blogs), a FinTech Titan (Next Bank), one of the Fintech Leaders you need to follow (City AM, Deluxe and Jax Finance), as well as one of the Top 40 most influential people in financial technology by the Wall Street Journal’s Financial News. To learn more click here...

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  • Peter

    I think bans are doing exactly what banks are originally meant for: ensuring people don’t lose money. This, I think is where being conservative and cautious, managing risks come from. Banks have a few things to protect in order to do this: their franchise (customers), their organisation (as that’s the tool they have in place to ensure their mission) and their margins to keep the former.
    Fintech (viewed from this angle) does parts of what they do, but more efficiently (smaller organisation, smaller margins). It would be a rather difficult performance to downsize a bank and transform it completely at the same time in order to compete. Creative destruction does not really vibe within a bank – if your original mission is to protect thing, you don’t get creative and don’t destroy stuff.

  • You are correct on the counts but two things will continue to drive CEO absenteeism on this issue:
    1. Timing. I’ve been in 100s of c-suite meetings in the last five years and noticed one ore leant theme: we are a half a generation away from the next wave of leadership change. With ten or less years left, there isn’t the time or desire to chart a new course.
    2. A near return to pre-recession profits. When banks feel pain in their NIN, they will be more open to this discussion. We need further business erosion to get there.
    You are correct and I love your insights but you will need to speak more until the crowd shifts course with the winds.

  • Chris,
    Spot on. This is the challenge. Honestly many teams are trying to change, and trying to change fast in some instances, but this is a core issue – core systems and core culture. Culture starts with the CEO in most cases

  • Melissa Craig

    There are plenty of very reputable global companies who can provide a 2 year blueprint to banks.
    This blueprint includes not just an IT plan to replace core banking systems. The blueprint also includes a financial model of what future cash flows will look like in the inevitable downsizing. It also includes a model for managing the compliance issues for what will surely be a lot of 3rd party providers connnected via APIs.
    The solutions are out there for bank mgmt with the courage to take the first step. The alternative is to just fade away while the world moves on.