Disrupting the banking experience can only be achieved through team work
In 2008 banks were considered to big to fail and sovereign Governments pumped hundreds of billions of dollars into the system to save them but now, years after the events of 2008 conversations about how banking and the banking experience could be disrupted, over the medium to long term at least are looking increasingly plausible.
Over the past number of months I’ve been speaking to the senior executives of many of Europe’s largest banks and while it’s clear that all of them see disruption happening on the margins none of them are worried that their industry is going to get flipped on its head any time soon.
That said though we live in a digitally driven, connected world where the rate of industry disruption, spurred on by the network effect is accelerating and the evidence is there for all to see that organisations who live by old rules die by them.
Technology as a democratising force
Technology is having a democratising effect – it’s lowered the bar to entry and it’s shifted the power away from the corporations and into the hands of the individual. Over the past three years the number of start ups registered around the world has shot up ten fold to over 100 million per year and during the same period the number of patents has increased six fold and it’s all because of the democratising effect that technology is having on Entrepreneurship and our ability to easily and quickly fund, resource, produce and sell new products and services.
Over the past five years there have been 174 start ups like Airbnb, Beats, Box, Dropbox, FIS, GoPro, Jawbone, Nest, Palantir, Pintrest, Shazam, Spotify, SpaceX, Square, Tesla, Uber and Zillow that have hit multi billion dollar valuations and created new markets worth $1.5 Trillion. In a world where the next great idea and the way to fund, resource, produce and sell it is only a click away the next disruption is a matter of when not if.
A Swarm of Start Ups
I recently had the privilege of sitting down with thirty of Londons finest Fintech’s at Level 39 in Canary Wharf. Initially there was a lot of discussion about how they could get their products and services adopted by the major banks but after about half an hour talk quickly turned to why they needed to be adopted at all.
After all each of them represented a different piece of the financial services jigsaw puzzle – from mortgages, loans and savings to wealth management and payments. All that was missing was a platform and a collaborative working agreement that could unify their products and services under a single brand and present one face and one unified experience to the consumer.
Using an analogy from nature; a single Bee is nothing more than an irritant but when they swarm they present an entirely different type of threat. If todays Fintechs were able to band together to present a single view to the customer then they would have a value proposition and a user experience that could best most banks.
While many senior executives from many industries, not just financial services are assessing the impact that individual start ups might have on their business very few, if any of them are assessing the impact that they will have on an industry or an individual organization if they all begin collaborating.