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CFTE Fintech Round-up
Why banks must embrace open banking or risk disintermediation
Banks globally, are facing increasing competition from fintech start-ups offering more focused banking services with superior customer experience. This article from ZDnet captures the mood perfectly. In order to remain competitive banks must change their inward looking attitude and open up their banking infrastructure.
A key aspect of this will be to make their API’s available to third parties, which means sharing customer data and enabling new functionalities to be added to existing banking services. The hope is that by collaborating more the services they offer will be more in line with their customer’s needs and user habits.
In some ways, it’s not a matter of if traditional banking firms should move to more open banking services, it’s a matter of when. Adoption of non-traditional banking services is being driven by millennials or those born between 1981 to 1994 and in order to maintain profitable incumbents will need to engage with this demographic.
12 reasons why banks don’t innovate
Staying with the theme of innovation in banking, the man himself Chris Skinner reflects on an expo he recently attended in Romania. One of the presentations got his attention, and if it got Chris Skinner’s attention then it’s only right we share it with you!
Take some time to read through ‘12 reasons why banks don’t innovate‘ and just maybe you could apply some of the lessons learned to your own organisation.
Techcrunch on Banking the Unbanked
Techcrunch focuses on the huge potential of fintech to reach the 2 billion or so unbanked people of the world. Joshua Bateman highlights the growing need for more flexible payment solutions for people in developing countries without bank accounts. He clearly demonstrates the potential by discussing how Gmobi, dLocal, and Coins of Asia are successfully reaching the unbanked with innovative new services. With investment in Fintech reaching $11.2 billion in 2016, Asia is fast becoming a leader in pioneering new fintech services. Thus the market for serving the unbanked represents opportunities for economic growth and delivering meaningful social impact.
Gen Y lacking the skills of New Finance
Great article from the FT that looks at the current skills shortage among Generation Y. One would think that these so-called digital natives, aka Millennials, would be the answer to the banking sector’s problems to digitize. However, as it stands a lot of financial firms feel there is a significant skills shortage in technical and commercial areas. Conversely, the emergence of fintech as a leading source of growth in post-Brexit London will attract finance highly skilled finance professionals who have the appetite to build on their existing skill set.
Bonus article – Sylvain Kalaches’ Shout out to Jeff Bezos
Holberton School founder, Sylvain Kalache responds to Jeff Bezos’ tweet with a thoughtful article that highlights the need for a new approach to education. Fresh from his takeover of Whole Foods for $13billion, Bezos put on his philanthropic hat and took to Twitter to sound out new ideas that could make a real short-term impact to people lives.
Well, Sylvain has the perfect answer. Education hasn’t changed for what seems like time immemorial. Admissions to the best schools and colleges are still skewed to the elite few who can afford it. Holberton School seeks to address this disparity by taking a more inclusive approach. With applications open to anyone, they aim to train software developers with the key skills the biggest tech firms in Silicon Valley and beyond are crying out for. Thus, by creating new opportunities for those who would otherwise be stuck, Holberton provides an excellent model of education that can make a genuine impact, both in the short term and long term.