I was recently asked to deliver a presentation set in the year 2030. It was challenging, but interesting. The session was recorded, you can watch it here …
… or, if you don’t want or cannot watch it, then here’s the transcript.
A 2030 retrospective [transcript]
Hi, I’m Chris Skinner and I have known BAI for more years than I care to mention! Man, and boy, and I’m delighted they have invited me to join you at their 2030 Conference, looking back over the last decade as to what happened in financial services, and looking forward into the next decade to 2040, and what might happen in the future.
I guess the reason why we wanted to look at this past decade is that so much has happened. It’s been a real phenomenon, in that what we’ve seen is in 2020, 10 years ago, you may remember we had this thing called Coronavirus? Pretty much we all thought we’d fast forwarded into 2030 because we all had to go digital to work from home, and be entertained and serviced at home, but actually we didn’t. We just fast forwarded what had been bubbling during the 2010s and implemented them in 2020.
Now in 2030, we’ve come so much further and when I look back at the last 10 years, I guess the easiest way to look back at the last 10 years and at the next 10 years is to think about how politically, economically, socially and technologically we’ve changed.
In the USA, at the start of the decade, we had the change of power from the Republican Donald Trump to Joe Biden, and we went through a lot of change from being full of hope, to full of hate to full of healing. Then, with President Harris in the mid-2020s, we restored the health of the nation and changed the way we look at things. In particular, she was very driven by the ESG agenda – the Environment, Social, Governance agenda – and by doing good for society and good for the planet by behaving responsibly as a government.
Do Good for Society and for The Planet
Finally, as we entered the late 2020s, President Musk has made a real difference with higher ambitions.
As you know, from the projects in space that he was working on for many years, we now have a clear multi-planetary program for not just America, but the world. America had been leading the developments in those space technologies, very much driven by the tensions between China and America, and that’s the reason that President Musk was brought into power.
At the start of the decade we had these technology players taking technology leadership, with Unicorns like Tencent, Alibaba, Ping An, Baidu and others creating a shift of power. A shift of political power in particular but, more than that, technology power and social power to China.
In China we’ve been seeing more people coming out of Universities with engineering, science and technology degrees, than any other nation. In 2023, in fact, more Chinese students graduated in stem focused studies than the whole of the population of the USA. So, that says something and there’s a reason why the Chinese were the first to really start to build the settlements on Mars, that had been the ambition of people like President Musk.
It’s this tension that has led to the way in which we think differently. We are thinking much more as a global enterprise. In fact, it’s quite good that between President Ma of China and Musk from America that we’ve managed to forge an alliance to jointly colonise Mars, rather than having this as a competitive race between nations. I’m also delighted in the way in which other nations have joined that task, such as the Indians and nations of Africa.
With all of this focus upon multi-planetary colonisation we have to recognise that , in just one decade, we’ve changed from being focused on our nations to being focused on our planet. That has been one of the biggest change factors since 2020.
This has also changed the whole way in which we think about economics and business and commerce because, during the last century, Milton Friedman’s model of economics drove our focus. That model of economics is broken. If the only role of a company is to make profit, it does not make sense. Friedman’s model of shareholder capitalism, which demands driving resources and activities to always increase profits as long as it’s legal, is broken. This is because we have to ask the question: “does that mean we should just make money at the expense of society?”
I remember when Jamie Dimon retired from JP Morgan Chase. During his final years of tenure, he introduced a lot of change around stakeholder capitalism. Stakeholder capitalism focuses upon serving the needs of the society, the environment, the community, the people who work within the business, the customers of the business, not just the shareholders of the business. It was then, in the 2020s, that we saw corporate America break its ties to the historical past of Friedman’s shareholder economics. This was encapsulated in a commitment, back in the late 2010s, to what is now known widely as stakeholder capitalism. Delivering value to all of our stakeholders, not just our shareholders.
At the time there was a lot of lip service to this. We saw a lot of businesses talking about it, but not actually delivering it. Yet, going back to the ESG agenda, it neatly tied between President Harris’ agenda of Health for America as a community, as a society, as a country; and the integration of the USA and China and India and other nations in a mission of multi-planetary exploration. The social implications of that led to business changing rapidly from the shareholder to stakeholder mission.
Then, I guess, the biggest thing we saw in the last decade was the platform for purpose-driven business in finance, in trade, in commerce, in all aspects of society, in travel, you name it. In fact, a lot of that did come out of the Coronavirus whirlwind the world suffered from 2020 through 2022. At that time, a lot of businesses were hurting and, as they came out of that, they realised they had to stand for something. If you don’t stand for something, you fall down.
Economically, the purpose and stakeholder focus, combined with the whole environmental, social, governance agenda, has been the beating drum of how the last decade can be summarised. This is how we’ve changed the foundations of how we think, work and live. For financial services that has been something that has been forced upon all of us, partly politically and regulatory wise but specifically because of our customers.
I’m obviously of an age where I’m moving towards the late customer demographic that’s no longer as relevant as the next customer demographic. We have the Millennials who are now, in fact many are starting to move towards retirement and 401Ks. We’ve got the GenZs who are the main people who run our businesses and our banks. They get this.
Then there’s the iGen, the guys who were raised on iPads who are actually now our main workforce and customers. These new customers, new workforce and our new management are acutely aware of the way in which the world needed to change, and have been the driving force for change.
Ten years ago, when the world went through lockdown, the major difference is we stopped people being able to work in the cities, in offices. People can work wherever they want, however they want, and that’s a fantastic change in society and the way in which we do things because now you can be out of Silicon Valley, out of Wall Street, out of New York, out of anywhere. You can work wherever you feel you want to work.
As you know, that has had huge impacts upon the restructuring of our real estate markets, of our investment and asset management markets, the way in which we think about property and equally the way in which we think about digital assets.
I guess the biggest issue that’s being faced is that the post-pandemic start of the decade created this huge debt mountain along with a huge market of people who have come through those years and retired, and the majority of our population is now old. We don’t have enough young workers, particularly young skilled workers, wherever they are located, to replace the requirement to pay down that debt. Europe and America particularly have been struggling with this which further fuelled the escalation of the multi-planetary colonisation agenda of China and India ahead of the USA, although we are just about keeping up. It’s also fuelled a whole way in which society thinks differently about things.
As mentioned, it has brought the purpose-driven ESG agenda – doing good for society and the planet before profit – to the table. They forced that upon us. That was bubbling in the 2010s with the Extinction Rebellion climate emergency activist consumer young, but now they are everywhere. You cannot ignore them. They storm our offices, where there are offices, our branches where there are branches, our government buildings where they are government buildings. In fact, in many ways it’s a good thing that we got rid of most of those buildings and most of that structure of having everybody concentrated within small groups in large cities and can distribute and democratise things so much more across the country and across the world.
There are many advantages to the change we saw in the last decade. Technological progress has seen a major change, as the last decade has digitalised everything we do. We came out of the great depression of the 2020s with a K-curve economy. The upside of the K proving to be the digital economy and the downside of the K proving to be the physical economy. Just as offices and high streets and main streets have disappeared, they’ve now appeared in different forms electronically on our smart phones, smart watches, smart wearables as digital main streets.
We’ve seen everything moving from offline to online. It’s such an old term ‘online’. I don’t like to use it. I prefer to look at the actual things that happen, such as the closing of all our shopping malls because they were no longer needed and the rise of connectivity via the internet. The more time goes by, the more we are all connected globally living locally.
I’m making this presentation to a global audience from a small rural village in the middle of Poland because I can. That’s been something that for the last thirty years has been rising faster and faster, and today we have television studio quality for projecting ourselves as live media from our lounges and living rooms.
The late Queen was a bit of a trend setter in this space, when she started using Zoom at the start of this decade. Now we don’t even Zoom or videocall; we hologram meetings. We meet in a 3D way, that I could not even have conceived of ten years ago. This is enabled by the iWatch and other wearables that came in to play, which allows us to project ourselves three-dimensionally over distance. There is no distance between us anymore.
When we bring it back to financial services, one of the greatest changes socially, technologically, and economically, has been the activist consumer. The democracy of the network has risen to fight for equality and society worldwide. Citizens and consumers have recognised that they do not want to deal with government and finance the way it used to be. I grew up with government and finance in a world where I accepted that the government controlled the money supply, and the government controlled the law. Today’s generation don’t feel this way, and this is one of the things that really made me wake up in the last twenty years. I’ve made a lot of money out of cryptocurrencies.
The cryptocurrency technology change has changed the whole of banking and finance.
The biggest banks in the world today are companies like Square, PayPal and Coinbase, because they focused upon the democratised and decentralised financial system. Who would have predicted that ten years ago?
Luckily, some custodial and treasury services managed to convert to keep up with that demand from the customer, as it was the demand of the customer that drove this change. The demand of the customer is one where they want things in their control, not in the control of banks and governments and business. They want it decentralised and democratised. I think that’s been the radical change of the last decade, as evidenced by the ascendancy of President Elon Musk. He is a visionary who Americans truly believe represents the people by giving power to the people through technology.
In summary, in technology, our greatest challenge today is the lack of ability to manage people, because they manage themselves. The demand for privacy and to own sovereign identities is what we saw emerging for the past twenty years and will be the struggle for the next twenty.
We’ve seen, as I already mentioned, the tensions between nations such as China, India and America and yet, at the same time, we’ve seen global democratisation and decentralisation of people’s ability to do things via the network. The issues and extremes swing between identity politics versus the privacy of the individual. This has been our greatest challenge in traditional financial services, and this challenge has been leveraged very heavily by the FinTech community, who are still very aggressive in their targeting and taking over key elements of what traditional financial service providers do. In fact, what’s most notable in the last decade is that the FinTech companies who have succeeded the most are those that have not competed with traditional banks. They have left the traditional things with the traditional banks that actually have become fairly irrelevant – the physical stores, the dealing with fiat money, the foreign exchange processing, the paper trail of supply chains, and such like.
The FinTech companies who are most successful today pivoted and focused upon the cryptocurrency community, the digital currency community and the dealing with specific financial markets that were not being serviced well by financial firms through the network, from payments through to privacy. That’s been the biggest change for me.
I look at the next decade and I look back at the last decade. There are so many questions that these things raise in my own mind. We ask questions all the time and can we answer those questions? We ask questions all the time about where the future is going and how we can predict the future from the past. That’s the reason why I looked back over the last ten years in order to try and look forward to the next ten.
Today, we live in a global, local community. We work globally from our local office, wherever that office happens to be established. Today, we deal with people based on instant recognition of who they are and their identity, by getting an anonymised persona of who they are and their identity. We do not share data anymore as we are truly digital and decentralised. Citizens own their data. You can see the impact of this from the collapse of Facebook last year to the rise of MyData today. We are no longer trying to do digital; we are digital. The most successful financial firms over the last decade and through the next decade, such as PayPal, Square, JP Morgan Chase, are those that made that pivot to focus on those services: decentralised, democratised data, finance and identity.
The many financial firms that managed to pivot in the last decade are the firms that focused upon being cloud-native rather than cloud-based. So many companies made tactical decisions to move to cloud-based services in the 2020s and have now disappeared. There’s a clear dichotomy between those that built a business model that was actually designed to be born on the internet, to be cloud-native; versus those who tried to evolve to the internet, to be cloud-based.
It’s like the dichotomy between the digital immigrants and the digital natives. We have the banks and the financial firms who were cloud-native versus those who were cloud-based. The cloud-based companies are the ones that unfortunately are no longer with us and in fact, many of the major movements of banks to be acquired by Fintechs has been quite interesting. Specifically, I think the acquisition of Deutsche Bank by Revolut was a major moment that woke us all up in 2025, and since then we’ve seen so many more of the institutions that we used to believe were rock solid proving to be actually quite flaky. That flakiness is all because they didn’t get digital and technology change in the last decade.
In final conclusion I think the biggest thing for me, and I’ve been campaigning for years about this, is that we had to be omni, but those that focused upon omnichannel are the ones that are no longer with us. Those that focused on omniaccess and giving the customer control, are the ones that have thrived, survived, succeeded, and will continue to thrive, survive, and succeed in the next decade.
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...