6 Innovation Ideas for 2017 and Beyond Page 2
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Treat Startups Same as Banks
Youth and skill, or age and experience? This is something that has been long debated in the financial world, since the Fintech Golden Age roared in after 2008. The fact is, a little age and respectability is sometimes a key factor when it comes to consumers and clients choosing a financial services provider.
But according to Bruce Wallace, chief digital officer at Silicon Valley Bank, there’s one thing that might stall the aging process for these startups: the constant (and unnecessary, according to Wallace) demand for pilots and POCs.
“We don’t do a POC or pilot with Fiserv,” Wallace said. If there’s a technology you want to use, go ahead and use it. But putting startups thorough lengthy procurement and pilot processes can drain them of funding, slow down innovation at the banks.
In other words, fintechs are stuck in the same circle as many millennials: You can’t get experience without landing work, but to land that work, you need experience.
This means incumbents and older companies actually have a little more leeway. Take IBM’s Watson, for example.
Watson has solidly grown to the “millennial age,” according to Visa’s SVP of Internet of Things, Avin Arumugam. Companies and consumers know IBM, are probably already using IBM technology, and have familiarity with the brand: which means it’s much more likely that these clients are just going to integrate or partner with Watson without making it run a technological gauntlet, no matter how nascent AI tech actually is.
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There Already is an Uber of Banking
Regardless of whether the phrase “We want to be the Uber of…” causes your eyes to roll, the rideshare company has had a demonstratable effect on the world of transportation. Has a bank or a fintech done that for banking?
Silicon Valley Bank’s Dan Kimerling says yes, and put forward Capital One as the institution that has played Uber’s role in finance. Others pointed to Ant Financial.
In contrast, Wells Fargo’s Marie Floyd noted that Uber is “a little small” when compared to the giant strides banking has made within the past couple of decades (remember when you had to drive up to the bank and put your information in those little suction tubes?)
No @Uber of financial services? Try @CapitalOne, says @dkimerling of @SVB_Financial #GOFintech
— Philip Ryan (@philipgryan) March 6, 2017
Ultimately, BI’s poll on the subject sided with Floyd, in that most participants seemed to think that the “Uber of banking” is yet to arrive–good news for all of you fintechs out there, who have that in the company bio.
Has banking reached its #Uber moment? Read the discussion from Day 1 of Bank Innovation 2017 and vote. #GoFintech https://t.co/WQXnRac4Yr
— Bank Innovation (@BankInnovation) March 7, 2017
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Blockchain for Autonomous Cars
Blockchain holds a lot of promise for financial services, and already has everyone in fintech contemplating potential innovative use cases. Even though data reconciliation, KYC, and regulation all sound fascinating, one out-of-fintech blockchain idea stood out the most during Bank Innovation 2017: autonomous cars.
“Imagine a future autonomous car, which can drop you off in the morning, be an Uber during the day, and pick you up at night,” Deva Annamalai, director of innovation at Fiserv, said on a panel. Blockchain technology would make this possible by giving autonomous cars, as well as users, unique identifiers, and creating a secure trust protocol. Additionally, DLT can help with the supply chain tracking needs of major OEMs, Brian Behlendorf, Hyperledger’s executive director, told Bank Innovation previously.
However, autonomous cars — just like blockchain — are still (mainly) in the testing phase, promising a brand new take on transportation of things and people sometime in 2021.
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