Welcome to 2020. It’s a new day. It’s a new year. It’s a new decade. And yes, I’m feeling good.
This is a year all of us futurists have looked forward to for over two decades as, back in 2000, it became popular to talk about a 2020 vision. I’ve made lots of presentations and films about 2020, as have others, but many were off the mark.
For example, towards the end of 2019, I got reflective and thought about the last decade. In 2010, there was an iPhone and app store, but early days. Cloud was around, but not discussed. Bitcoin had arrived, but no one knew about it or crypto or anything. FinTech hadn’t even appeared on the radar of most people and banking was all focused upon just that: getting back to being boring old banking and not basketcase banking, as had appeared in 2008. No one knew what 2020 would look like.
How ten years has changed everything. Today, I cannot look a decade ahead. But someone did ask me to look a year ahead and asked what should we be talking about in 2020. So, I sat down and made a list of 11 things to think about in 2020 from a FinTech point of view. In no particular order, these are:
Doing Digital: yes, this is the title of my next new book (out next month) but the focus is upon how banks are actually digitally transformation. Are they really doing digital or just talking digital? Do they get digital transformation as a restructuring or just think it’s a project? Someone said to me the difference is changing your diet versus changing your clothes. The former can transform you. The latter just makes you look different. In 2020, are you really doing digital?
Digital Currencies: with the launch of Libra last year, and the discussion of China and Sweden issuing central bank controlled digital currency, 2020 will focus on this much more. There may well be many currencies out there, and it is a threat to the more than 2,500 that are out there already. Reason being that most cryptocurrencies are backed by a white paper and a server somewhere you can’t find. I’d rather trust a regulated body with my store of value than a coder, and 2020 will see that battle play out big time.
Digital Identity: wrapped up with the whole digital thing is who can you trust? Without a trusted identity mechanism, anyone could fool you online and digital identity is more than just about security. It’s about trust, again. The UN has a mandate to create a global identity scheme by 2030 for everyone on earth. That’s only going to be achieved if we can start with baby steps today. 2020 will see a lot of countries focusing upon digital identities to go with their digital currencies.
Digital Inclusion: digital inclusion is all about financial wellness, financial literacy and financial inclusion. Now that we have cheap networking over a mobile network that can reach the most remote consumer, we need to focus upon how we serve them, wherever they may be. Digital inclusion goes beyond just transactions by building upon microfinance and microlending. This is the hot space for the telecommunications firms, and should see 2020 seeing things happening everywhere, not just in a few African nations.
Digital Society: a fourth major focus in 2020, building on the points above, will be the creation of digital societies. Governments are already hot on this space and I see this as the battle between Big Tech and Big Gov, where finance falls somewhere in between. As Liz Warren and Margrethe Vestager battle to break up the big Silicon Valley giants, their governmental programs may well build on these war cries and start focusing upon a governmental system for a digital society. If they do, they can learn a lot from India, where the unified stack and its components are already well on the way there.
Cybersecurity: no one likes talking about online, mobile and digital, without mentioning that it must be secure. There you go. I’ve said it.
Purpose-driven banking: this is a nascent topic that I started blogging about in earnest last year. I think in 2020 it will become an even stronger rally call. What is the purpose of a bank? To make profits for shareholders or to be useful to society and the planet? If it is purely the former, I claim that banking has a short future and may be extinct by 2030. If it is the latter, then that gets into a different dialogue and a far more meaningful one. What are banks here for? What is their purpose? Why do banks exist? We need to put far more socially useful context around those questions than just saying they are here to make a buck.
Intelligent Banking: yes, of course I mean artificially intelligent, but I also mean emotionally intelligent, building on the last statement around a purpose. How can banks engage with customers at the head and heart? How can banks leverage data to not just use AI for fraud and risk but to use data for customer intelligent service and support. Banks that really reach the heart of their customers by building digital relationships through intelligent analytics will really win in this new decade. The obvious rider there is that banks that aren’t intelligent will lose. Yep.
Financial Ecosystems: 2019 is the first year I met a Head of Ecosystems at a bank. How many banks have such a person? In 2020, many more in my view as ecosystems, collaboration, partnerships and platforms are all the name of the game. If a bank doesn’t have a Head of Ecosystems, then what are they doing? Everything on their own? Probably, but in the age of Banking-as-a-Service, being a lone cowboy is the way to become an outlaw. You need to engage with all, not ignore them.
Quantum Leap Banking: that’s my phrase for any of the many new technologies that banks should be looking at from quantum computing to facial biometrics to cloud-native everything to more. To be honest, there aren’t many new, new technologies on the horizon – quantum is about it – but what about blockchain and crypto and stuff? We need to talk about these things in 2020. Maybe just not as much as we will talk about all the other stuff.
Future Vision: I know that banks are focused upon the last quarter and the performance metrics, but I have also been surprised by how many banks are now focused upon the future. Deutsche Bank, Royal Bank of Canada, HSBC, UBS and more all have visioning programs to try to see where the world will go. Does anyone know? Well, you can always hire Chris Skinner to find out.
Anyways, there you go. Those are my 11 priorities to kick off 2020. What are yours?