The long writing hiatus is chiefly due to being busy, but also having to process how I feel about a rather bedazzling find: “Tangible banking” stood still while I was “away”.
Not all of it, of course – there was much done on the launch and proposition of challengers and front-end of neobanks – but for traditional, big retail banks, time shockingly stood still. A time they could hardly afford to lose to begin with.
As some of you know, I left the very practical side of things – selling and designing a core transaction and data fintech product for banks who desperately needed it, as it could dramatically change the consumer experience. I did this about 18 months ago, to do the “less tangible” banking stuff, and ask them to stop and think of consumers’ feelings and take introspective, long, hard looks at their organisations. One would argue that I moved from being a “doer” to a “thinker”. Some would argue I moved from being a fintech-er to being a professional finger pointer. Call it what you will, I spent that time writing as a banking consumer advocate, advising lots of fintech companies on how to approach (if not defeat) inertia, and even working with a handful of genius banks who “got it”.
A couple of months ago, I went back to “tangible banking” by working closely with a company that also has an amazingly smart and technically brilliant product to dramatically change the consumer experience, this time on the onboarding side. I was blow away by where banks had gotten in the time that I was “away”.
The heavy stuff
Reaching out to some of my old clients and prospects I heard the same complaints and excuses, and I attributed them to the natural moaning needs of unsung heroes – bank employees who stuck it out during this fintech palooza and tried to make these organisations move. A task worthy of Sisyphus.
Sadly, as I gained a deeper understanding of what exactly their organisations have brought to the consumer in the time I had joined the “intangible banking fixers” brigade, the complaints are genuine – nearly nothing substantial can be pointed to, and some of the same projects that were slow moving back then are still around, whether on hold or being resurrected now. The big, worthy ones. The ones about IRL data access, the ones about replacing spaghetti back-ends that prevent change, the ones about vision that’s truly digital – the heavy stuff.
Look, I get banking inertia caused by “Business Prevention Departments” (JP Nicols Perpetuity TM) as much as the next frustrated doer or thinker in the industry, and I realise that, to my FinTech Mafia gang, this is another article on the “same stuff I’ve been writing about since 2000”, but this is a whole new level of ludicrous. When I left “tangible banking”, there was much buzz about how banks were “finally getting somewhere”, and heaps of really solid projects in the works. They have all but vanished.
Here is who (and what) I blame:
- Blockchain. Yes, it’s complex, and yes it’s potentially revolutionary, but did everyone in every financial institution drop everything else they were thinking about to read and learn about it?
- The slow pace of industry innovation. Just look at a the Finovate buzzwords card and you’ll know nothing much was offered to the banks from the fintech innovation side of things in the last 3-4 shows. This is partly because there is state-of-the-art front-end and no easily approachable back-end proposition fodder out there, but also because fintech needs to make a buck, and pushing the innovation barrel too far ahead of the banks makes no ROI sense.
- The inability to catch up with knowledge houses. Six or seven years ago, the big consulting giants were woefully behind in offering any kind of serious strategic guidance to big retail banks in digital, and top product offerings stood in for them. They still are and they still do.
- Fintech commentator inflation. A few years ago, there were 30-50 voices internationally who stepped in for the knowledge void created by the analysts and consultants. In two years, that number has immeasurably exploded. While this will be great for the industry over the next two years – as it will filter into real value, and some newcomers are providing this already – it’s simply just massive noise for the banks, compounding their confusion.
- The Great FinTech Distraction (TM). The mere number of innovation labs, funds, incubators, aggregators, and all other “-gators” says it all. How is one to focus on getting things done when one isn’t sure what the next best thing is, and needs to keep on scouting?
Much as I would rather find reasons to praise the big retail banks and distance myself from the mindless bank bashing that some have taken up as a sport, for the reasons above I feel that everyone dropped the ball and allowed a vicious sort of analysis paralysis to take over. Let’s pick it up again and get going on that free-to-spend project from 2001.
– This article is reproduced with kind permission. Some minor changes have been made to reflect BankNXT style considerations. Read more here. Image: Planka.nu STHLM, Flickr Creative Commons