I recently was interviewed for a conference in Miami, and thought you might enjoy the Q&A so sharing ...
Your book “Digital Bank” published in 2014 included extensive guidance and background on the digital revolution in banking that was taking place. Are changes going at the speed and in the direction you envisioned?
Yes. I think the book was timely, in that it came out just as FinTech started to take off and digital became the buzzword. Nearly every bank I talk to now has some form of digital leadership program, and is investing in systems refreshment and working with start-ups. The disappointing part of this is that banks are still finding it really hard to change. Their leadership teams are not up to the job of digital transformation in many cases, and think that just rolling out a mobile app has given them a digital bank. It hasn’t. It’s just an app. A digital bank has digital at its core, and that is still not happening with many. It will, but it needs a change of leadership for the bank to make this happen.
You mentioned in your book that Barclays, mBank, Metro Bank, and FIDOR Bank are examples of corporations embracing the changes or being born as a consequence of the new landscape. Do you still consider all of them outstanding examples or have other competitors surpassed them? In that case, who are they and what are they doing right.
They are good examples, but others are now in the frame. For example, in the UK, we have seen many new banks starting up with Monzo leading the pack. Equally, Che! Banca in Italy and Bunq in the Netherlands have caught my interest. There has also been notable banks making headway like BBVA in Europe, DBS in Asia and Capital One in the USA. The digital field is getting more and more coverage as the years go by.
You use to think the implication was that banks must become digitalized, and that was a challenge as becoming a Digital Bank demanded new services focused upon 21st-century technologies. Is that still the challenge or has industry evolved and new challenges have emerged?
This is still the key challenge. What frustrates me is that banks are not tackling the fundamental issues, which is rationalising their data architectures, moving services to the cloud, developing open banking APIs and partnering more to co-create innovation. Until banks get real technology leadership and move away from being proprietary creatures based upon old systems and legacy structures, they will never get digital.
How does your new book relate to “Digital Bank”? Is it a sequel?
It is. The two books are siblings if you like. Digital Bank focused upon how to become a digital bank, whilst ValueWeb focuses upon the rise of FinTech and how blockchain and mobile technologies are building an internet of value. You need an internet of value to work with the internet of things, and the internet of value, or ValueWeb, is real-time and low-cost.
What is the role of FinTech in building up ValueWeb?
FinTech is at the core of the ValueWeb, with new visionary firms building the new network. Those firms include Stripe, Venmo, Ant Financial, Paytm, Stellar, Ripple and more. Combined, these firms are reimagining financial services for the internet age.
What are the challenges ValueWeb needs to overcome to unlock its potential?
Actually, it is more a question of the challenges ValueWeb raises for financial institutions, governments and citizens. For example, a key part of ValueWeb is blockchain and cryptocurrency technologies. How are financial institutions and governments creating agreements to use these technologies for the next generation infrastructure, as its these technologies which will replace our passports, our benefits systems, our major infrastructures like SWIFT. These things are developing, but it takes time, with the Dubai government probably being at the forefront here. Dubai announced in 2016 that, by 2020, all government systems will be based upon blockchain technologies to ensure that all operations are digitised and no longer on paper. They are making it happen.
Are you working on a new book?
Yes. It will be released next year, and I would call it part three of this trilogy, as the new book focuses upon financial inclusion and how the ValueWeb is offering digital finance to everyone on this planet, not just the elite.
What is it called?
What advise do you want to give our readers?
Checkout my blog, finansernextjs.wpengine.com. I share ideas there every day and people tell me it’s useful. Equally, I would love to hear from your readers too.
Chris M Skinner
Chris Skinner is best known as an independent commentator on the financial markets through his blog, TheFinanser.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...