The Financial Services Club's Blog

The augmented economy

In the middle of my showreel, I talk about augmented  lifestyles.  I’ve talked about this for many years, but now it is becoming an augmented reality, especially with the launch of Google Glass.

The future is visual banking (still)

One of the discussions I was having recently was around a future vision for banking, and the idea of branchless banking reared its ugly head again.

As mentioned many times, I don’t believe in branchless banking in the future .. just less branches for banking.

Anyways, this discussion veered in another direction that also rang my old bells: remote visual banking.

Just as we Youtube everything, the idea that your banking would be serviced through a remote advisor who you could chat with onscreen came up as the ideal way to be serviced in the future.

This is a theme like branchless banking, cashless society and biometric authentication.  It keeps cropping up and then disappearing again.

The question is: can we really have a future where the bank deals with customers via remote visual media?

Yes.

Banks are just data vaults

There have been several themes I’ve explored on the blog lately that are the foundations of my latest presentations:

• Mobile is irrelevant, it’s the behaviours that are key
• Money is meaningless, it’s the data that is important
• Capitalism is dead, we are now ruled by social capitalism 
• Privacy has gone and security is our greatest risk

The themes of all of these blog entries are that banks need to think about how they reconstruct themselves for the 21^st century.

What this really comes down to is that banks are becoming pure managers of bits and bytes of data.

Stop talking about mobile, it's not important

My latest presentation is apparently a polemic.

That’s what my colleague said yesterday, when I said that my new presentation has three themes:

• Mobile is irrelevant;
• Money is meaningless; and
• Capitalism is dead.

I wondered what she meant by polemic, so checked out the definitions online and Wikipedia defines it quite well: a polemic is “a contentious argument that is intended to establish the truth of a specific belief and the falsity of the contrary belief. Polemics are mostly seen in arguments about very controversial topics.”

Oh goody.

I also found another definition I prefer from Merriam-Webster which is that a polemic is “an aggressive controversialist”.

Even better. 

2013: The Technology Landscape

2012 didn’t really see any new technology outcomes. I look around the house today and see an iPad, iPhone and other things, but nothing essentially radically new from 2012 that’s big and different.  But something is about to happen that will change things fundamentally.

2013: Five Key Banking Bets

After discussing the economic backdrop, with a hot South America countering a consumerising Asia, it’s time to move on to looking specifically at the banking outlook, which is grim.

Or is it?

2013: an Economic Outlook

OK, OK, it’s time to get down to the real business of blogging, banking and bonuses.  As per my usual form, here are four specific forecasts for the economic movements of 2013:

1. The USA is a solid rock (but)
2. South America is the place to be
3. China becomes a hot consumer market
4. The Eurozone stays together with fissures, cracks and holes

Ten wild predictions for 2013

Next week, I’ll get back to being Mr. Boring Banking Blogger, and will focus upon the economic, financial and technological trends for 2013, as per my usual start to the year.

For today, purely because it’s still the silly season (yes, 12 days of Christmas is still going strong here), I’m going to make ten mad predictions for 2013. Let’s see if any of these come true.

Were Skinner’s 2012 predictions correct?

At the start of the year, I always make a few predictions about what will happen in the following year.  Watch this blog in January for 2013’s predictions.  But what were the predictions for 2012?

Well Economically, I made the following forecasts:

1. Asia’s light continues to shine, but not quite as bright
2. American equities is the place to invest
3. There will be a major European bank failure
4. A country will leave the Eurozone

A Banking Union? You must be joking!

For the last decade, I’ve been a fan of the Eurozone.

It’s created a lot of business for many of us.

The Financial Services Action Plan (FSAP), the forty or more Directives, the Single Euro Payments Area (SEPA) and all that stuff has been good for business for consultants, technologists and for some bankers too.

But life is what happens to you whilst you’re busy making other plans, so the bank plan has encountered a rocky course in recent times.

Can banks meet the hybrid challenge?

It’s taken me a while to work out why  social media and stuff is such a fundamental change for banking, but I finally think I've got there and it's clearer.

It started with the rise of blogging and social media such as YouTube.

I still retell the story of McKinsey’s Chief Executive who was side-blinded by the appearance of YouTube back in 2006.

The morning papers appeared on his desk with the headline: Google acquires YouTube for $1.65 billion.

He had never heard of this company and so called in his team and asked the question: “What is YouTube?”

None of them knew.

Too fast to innovate, too slow to change

As mentioned yesterday, the regulator tries to keep up with the banks who try to keep up with customer, and I said that banks often innovate too slowly.

There are many examples of this, but the one that I come back to regularly is Chip & PIN.

Chip & PIN has been an enormous success, lauded and applauded by the Payments Council and now emulated worldwide with just the USA to follow.

The program was agreed in principle back in 2000 through APACS, the Association of Payments Clearing Services, and the implementation plan sorted out in 2003.  The EMV-based Chip & PIN program was introduced to the UK in 2005 and made mandatory in February 2006.

The great news is that after Chip & PIN was introduced card fraud decreased considerably, with lost and stolen cards down over half …

Virtual currencies will explode thanks to mobile games

The European Central Bank (ECB) has just issued a report on Virtual Currency Schemes, with case studies on Second Life and Bitcoin (both previously covered in depth here).

In the report, the ECB calls Bitcoin “the most successful — and probably most controversial — virtual currency scheme to date.”

The ECB goes on to say that the concept of Bitcoin stems from the Austrian school of economics, where business cycle theory developed by Mises, Hayek and Bohm-Bawerk floated the idea that virtual currencies could be the starting point for ending central bank money monopolies.

The future of payments and technology

Andrew Vorster, Vice President of R&D and Adam Banks, Chief Technology Officer for Visa Europe delivered a fascinating double act at the Financial Services Club the other night.

The theme of the presentation was: the future of payments and technology, and covered seven key trends that Andrew and Adam have identified that will disrupt payments:

Do banks need branches?

We had a great debate at the Financial Services Club last night, picking up on that perennial debating point: do banks need branches?

In the pro-branch corner were Anthony Thomson, co-founder of Metrobank and Ron Whatford, former Chief Experience Officer with Lloyds Banking Group; in the anti-branch corner were Mark Mullen, CEO of First Direct and Brett King, author of Bank 2.0 and founder of Movenbank.

The future of the cash machine

I’ve blogged about the cash machine of the future before, with BBVA coming up with the idea of side-facing screens.

Very nice too.

NFC: No Flippin' Chance (or why contactless is a dead tech)

The world is a wonderful place, as times shift fast and things turn faster than an egg on a timer.

Just as you get used to one technology, another comes along and turns things on its head.

What technology do we mean?

NFC.

Near Field Communication.

No Flippin' Chance.

The more I think about NFC, the more I realise it is a dead technology.

NFC is a technology past its sell-by date.

The future of the payments terminal

I’m speaking at a conference on the future of payments today for one of the world’s largest suppliers of payments terminals.

They asked me my views on the future of the point-of-sale, and I said that it would disappear.

Not a good position to take when you’re the keynote speaker at a conference for a payments terminal supplier.

So we debated the point and here’s the reason why payments terminals might have a long-term future.

The future bank will be like Siri

I spent a day strategising with one of the Middle Eastern banks about the launch of a direct bank service.  One of the key questions they asked me is: do we organise the back office in the same way as our contact centre and internet bank service?

The easy answer would be yes, but that would be wrong.  The answer is no.  No way. Nada. Forget it.

A direct bank is a very different beast to an integrated bank.

Cyberwars: a far bigger threat than hacktivists

Whilst consumers are electing the next major political leader via crowdsourced populism, governments and companies begin developing cyberarms.

This cyberwarfare is already rife, with a host of malware targeting middle eastern nations (see end of blog entry).

What is obvious from these developments is that cyberattacks are the new form of warfare that evades direct hand-to-hand or nuke-to-nuke combat.

Like the classic 1983 film War Games, you don’t need to have war with weapons anymore, just cyberweapons.

And no nation is immune from attack.