JJ Hornblass, Royal Media CEO

Hi, everyone. I’m JJ Hornblass and welcome to FinTech Unfiltered from Bank Innovation, the leading digital news service on banking and FinTech. This is our weekly wrap for what’s happening in the world of banking innovation for the week of September 7. Before beginning I want to thank Bank Innovation advertisers Blend, Q2ebanking and Mambu for their support. Thank you very much to them. And I am pleased to have with me today, Bianca Chan and Rick Morgan from the Bank Innovation team. Hello, it is Friday, September 11 2020. This post Labor Day short week was back to school for much of America. Then, there was also the announcement this week that the first woman will head a major US Bank and that’s Jane Fraser, at Citigroup. There was tough sledding on the public equity markets and just really unreal forest fires raging on the west coast. But for us, our week was marked by the presentation of our second annual Bank Innovation Build, which featured both of you very prominently. So we’re gonna do a little bit of a round robin, and go through some of the key takeaways that you had from the event. And I think we’re going to start with Bianca. Okay, great.

Bianca Chan, news editor at Bank Innovation

Thank you so much. So one of the recurring themes that I noticed almost throughout every session throughout the two days of conference was the idea of stretching human capital and stretching talent in a purposeful manner. One of the best examples, I think was our fireside chat. Vanessa Colella, who wears many hats at Citi. And I think recently in February, she just joined on as a head of city productivity. But it was something that just came up it seemed in every single session. I know that Rami Thabet, who is the VP of digital product at RBC spoke about it in terms of making sure that there’s overlap between the innovation teams and the business lines, so that the two almost arms of the operation can kind of operate seamlessly and together Herman Man of BlueVine Chief Product officer there also spoke about breaking down the modules between you know, marketing lines, business lines, sales technology, innovative ation, and kind of unifying the team in that sense Sathish Muthukrishnan who is the Chief Information, data and Digital Officer at Ally Financial also spoke about human capital and how that’s going to be a big part of their kind of innovation journey moving forward, specifically looking at tapping, you know, your internal customers through almost like feedback and research and development of launching new products, which is like they’ve done throughout the pandemic and slowly but they’re going to focus on moving forward. So rather than looking to, you know, external pilot groups, kind of leveraging their own workforce of like thousands of employees, so that was just something that was hard.

JJ Hornblass 

Yeah, it was hard for me to gauge whether this focus is more a function of trying to. Is it an issue around more, more scarce resources? Is it that they’re seeing the budget on the horizon for 2021. And there there’s not going to be as much spend and therefore they need to look at kind of Other ways to either, you know, get more out of what they have or other means of market intelligence without tremendous spend, or is it just, you know, an evolutionary dynamic innovation? Did you get a sense for that?

Bianca Chan

Yeah. So I do think it is evolutionary just as financial services becomes more digital and more kind of tech forward. But it was interesting to me at RBC spoke about how they’re not just thinking about, you know, the budget for next year, but they think about human talent in terms of a 10 to 20 year horizon and trying to grow that talent. So I think it’s like a very long term kind of view that they’re taking on kind of, I guess, nurturing their employees, keeping them happy. I know, that’s something that Vanessa at Citi spoke about as well. So I think it’s both practical and then also reflective of where the industry is headed.

JJ Hornblass

Right, what about you, Rick, what were some of your, your key takeaways from Build? And I should mention that I mean, Build’s focus is on how to do innovation in banking. Yeah. What about you, Rick, what was your sense?

Rick Morgan, news editor at Bank Innovation  

There was a lot to process at Bank Innovation Build this year. But I think the biggest takeaway for me was that despite all the uncertainty and the disruption to core business lines, these banks and fintechs, they’re really not slowing down their internal innovation at all. And in fact, in a lot of ways that’s accelerated the needs for these innovations. I remember one of my most interesting points that I heard was from Citizens Bank of Edmond, Josh Pape, the EVP and chief banking officer there spoke about how they’re actually launching this sort of person-less branch they have patent pending. They built it all in house. And they were developing it before the pandemic. And basically, the way it functions is it’s a place for cash intensive businesses, whether they be bars or whatever, to go deposit, cash, make change, do whatever. And they needed this before the pandemic, because there’s lots of probably bars and other cash intensive businesses that are far away from their branches. And they don’t have the manpower to just staff a new branch in a random area. So they’re launching these sort of person-less, tech power branches that can do all these things. But the pandemic has really accelerated the need for that. So instead of, you know, shying away from innovation, and just focusing on a few things, they’re, they’re leaning more heavily into a lot of these projects that they had going before the pandemic. We also heard from Tony Glover, of HSBC. He’s the US head of retail banking there. And he talked a little bit about client onboarding, international client onboarding. And I know Bianca wrote a story about this and how they’re using it. Biometrics to make that an easier process. So instead of having to visit a branch, if you want to move to the US and open a US bank account, instead of having to visit a branch and you know, Singapore or Hong Kong or whatever, now you can just start zoom, take a selfie, I think you need to take a picture of your passport as well and upload those. And they can do it all online pretty much. And you know, Tony was saying that biometrics is cool, and the technology is great, but it’s really just about reducing steps and reducing friction. And he talked a lot about how there’s a difference between innovating in a way that actually helps your customers and innovating in a way that is cool for the bank. It looks cool, or it feels cool. You know this is an example on his mind of something that really actually helps and especially now during the pandemic, to make things easier if you do have to move to the US for whatever reason. So I think that was a big takeaway for me. Just that the new product development is not slowing down right now in a lot of ways it’s speeding up.

JJ Hornblass 

Yeah, I mean, I did. I thought that the that what was interesting was, I guess kind of somewhat similar to what you’re saying in the sense that I was, I think that there has been a more aggressive reallocation and repurposing of development resources at financial institutions as a result of the pandemic or during the pandemic. Then I think that we realized was certainly I that I realized I think you have, you know, there there was this veneer or that on the surface there, banks in many banks were trying to, you know, really presenting, I wouldn’t say a business as usual but but you know, really mindset or a perspective of not having things, you know, taking the crisis, in the math and the manner in which they can. But really, I think what I came away from build was that there was a lot more churning, you know, going on underneath the surface of the water. And and, and I think that the other sort of takeaway that I had from that was, and this is, I don’t want this to sound bad. But I think it’s kind of a good thing. I think that there is a real blessing in disguise just like so many things. With the pandemic there’s a blessing in disguise for banking, in the sense that the You know, this the realization that radical innovation and radical change can happen without, you know, the doorknobs falling off the doors. It is possible and I think it really opens up a really knew, you know, landscape for what is possible on what and where banking can go in the future. And that, that I think was a was a key takeaway for me. I don’t know if you saw if you felt this way as well.

Bianca Chan 

Sure. Yeah. I mean, you saw that when Steven Schroth from Key Bank spoke about the kind of agile transformation that they’re having, and how that kind of allowed them to make, to kind of rejig I guess their digital roadmaps and kind of prioritize one feature updates to one feature called EasyUp, which essentially, is a savings account that lets you every time make a purchase On your debit card, it puts money in the savings account. And now they’ve prioritized it have launched the ability to link that directly to a debt, whether that’s a key bank account or another financial institution. And he told us that the transformation to agile now the teams are their squads, and they’re focused on platforms and capabilities versus specific products, teams and efforts. And, for instance, a good comparison to show how the added transformation is kind of accelerated their digital production is in 2018, there was a 10 releases and updates to their mobile and online channels. And this year, they’re on pace to exceed 40 updates. So just being able to not only adapt quickly to the changing environment, but just it seems like they’re set up in a way where they’re able to do it a lot more quickly, which I’m not sure what it would have been the case.

JJ Hornblass 

Yeah, I mean, this has different ramifications for the size institution. I mean, And even small institutions that spoke during our executives from small institutions that spoke during Build talked about I think that their mindset is more aggressive than it has been, I think or faster now. You know, there is Vanessa Colella, you know, Citi is a whole other realm and which was interesting to hear from her, especially considering she has that, you know, she wears those three hats as you mentioned, you know, head of city ventures head of city productivity and and chief innovation Innovation Officer. But you know, her message to the new CEO, Jane Fraser was, you know, kind of interesting to me. You know, what she said was that, you know, she was going to tell Jane Fraser was But it was important to maintain tight relationships between Citi’s business partners innovation arm and its innovation arm and its technology partners, which I think is really, you know, talks to the underlying disruption that we have in the world today you know that this is this affects the implementation for innovation even at a at a large institution and just keeping keeping the the future in focus whether you’re a large institution or a small institution seems to be the you know, the the real driver or really the you know, the key the key for financial institutions going forward. 

Rick Morgan  

I thought it was an interesting point. Yeah, that keep all these people. I mean, I think some other things that I heard that were just interesting was that like you were saying, JJ, that the the innovation being this sort of out on an island, you know, its own little thing that that sort of does, you know, keeps to itself is not really going to be the path moving forward that that needs to be brought. The pandemic has shown that that should and can be brought in house without, as you said, the doorknobs falling on.

JJ Hornblass  

Alright, so now that we’re recovered from Build, or at least we will be recovered at the end of the weekend. What is in store for our readers next week?

Bianca Chan  

We are going to be 100% focused on just putting out our Build content into into news articles and condensing you know, the hours of sessions that we had.

JJ Hornblass  

Yeah, I guess we should mention that there are ways to ask access that content still, there’s a lot of recorded sessions that will eventually make their way on to Bankinnovation.net and certainly worth a look. Thank you all so much for being with us. We really appreciate it here. And please take a moment to rate FinTech Unfiltered on your podcast platform, and email us at info@bankinnovation.net. We’d love to hear from you here to hear about what you’d love to hear on our programs going forward. Don’t forget to follow us on Twitter and LinkedIn, and visit us online at finainews.com. Thanks, everyone. Take care.