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Money20/20: Banking on the future - are we there yet?

Amar Limaye
Money2020 event

Almost all of us at some point in our lives have been asked to envision a typical day in a world of the future. We may have imagined flying cars, or a robot dog. Some of us, who continued to daydream, may have considered how in the future we would manage our money. 
 
Opening this question up to my colleagues, almost every daydream involved speaking to a real person. When discussing complex, personal matters such as finance - as with health - humans want the chance to communicate with another human, albeit one that is an expert in financial management. The future, it seems, is being able to access a human at your convenience, and the human being not only an expert in the topic you would like to discuss, but also a pro-active advisor with expertise in your specific situation.

So, are we there yet?

Here’s the interesting part - the technologies to enable this largely exist. We have the digital communication channels. We have AI enriched methods to build customer profiles and huge knowledge bases to query. Yet I’m still unable to text a bank advisor to check that my daily coffee and avocado toast isn't what’s preventing me from buying that flat in Mayfair.
 
Next week, Kin + Carta will attend Money 20/20 where financial services leaders will debate this topic, and soon we’ll share our learnings. However, in the meantime, I’ll share my thoughts working as a hands-on strategist with technical leadership. 

“What do you call a financial services company that’s always innovating?
..A disruptive fintech”.
Bard, Google’s Generative AI tool

I asked it to explain itself… 

“This joke is funny because it plays on the stereotype that financial services firms are slow to innovate. However, there are a number of new and innovative companies that are disrupting the industry. These companies are using new technologies to offer consumers and businesses new and better ways to manage their money”.

Thanks, Bard.

 

Can you walk and run at the same time?

The hard truth is that the financial services industry, along with the healthcare industry, contains some of the trickiest conditions to innovate, not least due to regulation. Combining personal information with payment information, two of the most critical sets of data we produce as humans, puts trust at the top of the list of any firm, and comes with a very low risk appetite.

It wasn’t always this way. Many banks used to be early adopters of technology. Unfortunately, many systems that run today were set up during the early days of "server under the desk" computing. There is an urgent need to pull apart these legacy systems and build them in a more sustainable and forward looking way, before innovation can even be considered.

The road ahead is under construction...

The threat from challenger banks and fintech, alongside increased regulation and consumer scrutiny, makes it more difficult than ever to innovate. Standing still is not an option, so organisations are setting up ‘run’ and ‘change’ functions to try and address both challenges. In my experience, they’re often kept too far apart to be truly effective. The ‘run’ function is often firefighting and seen as a center of cost by the business, seemingly working against the mission of the  ‘change’ function which is often innovating in a bubble and desperate to scale.
 
The agenda at Money 20/20 promises to provide some answers to these challenges. We will be looking at AI in Fintech, the impact of CBDC's, and how to consider the human factor as consumers grow increasingly less loyal and more demanding. Look out for our next post where we will answer the question - how do we get there?

To learn more about how Kin + Carta can help you identify, test, build and scale emerging technology use cases such as AI, CBDCs and the next-generation customer experience, get in touch.

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