Once again, Sibos was the place to be to discover, discuss and understand how disruptive innovations are transforming the financial services landscape. Looking at the opportunities amidst the disruption, this year’s conference also further explored the evolving relationship and collaboration between banks and Fintech firms. Flexibility and integration is the common ground for financial institutions to embrace innovation.

Overall, I noted five main takeaways to keep in mind:

1. Collaboration is critical

In today’s fast-changing financial services industry, collaboration must be the first pillar in building a secure international banking system. As banks prepare for their digital transformation (which rests on multiple technologies), understanding and integrating customer behaviors is more important than ever. Collaboration helps financial services to be more proactive and build trust. SWIFT’s Global Payments Innovation initiative and the collaboration of banks to make it happen is a clear example of this displayed at Sibos 2016.

2. If you are not familiar with blockchain yet, then it’s time to get smart

There are a lot of innovations to invest in and much architectural complexity to resolve around blockchain technology. In the banking world, permissioned, private ledgers are in demand. Private ledgers give banks the control and efficiencies they need, underscoring the importance of redactable and real-time elements to the secure and accurate functioning of the financial services value chain—just as good governance is fundamental to Distributed Ledger Technology discussions.

3. Access to APIs is a must-have

Compelling customer experiences, market competition, legislation and regulation for payments interoperability all trigger Open Banking and application programming interface (API) discussions. As the payment markets of tomorrow are being built today, access to open APIs must be a service provided by banks. APIs are a part of the technologies that drive new ways to interact with customers, efficiency, greater speed and more traceability. They hold real potential for banks to cut their costs and amplify the value of their services. For more on APIs, read Driving innovation in payments—powered by APIs and open banking

4. Real-time matters

The payment industry is moving towards ubiquitous, real-time payments—both domestically and, in time, cross-border—through real-time interoperability of payments clearing platforms. To make this a reality, the financial industry will have to find the right balance between standards and innovation, and solve the non-technology challenges around risk and legal certainty.

5. Cyber threats are still real

While customer security is absolutely critical, cyber security persists as one of the most serious challenges facing the global financial community. Effective governance and cyber resilience are seen as the most powerful way for businesses to manage cyberattacks. Industry collaboration is a key weapon against major cyber threats, requiring a continual focus and a high level of awareness of cyber security.

2 responses:

  1. Hi Jeremy,

    Thanks for your insights. I’m currently working in the fintech industry and wondering what do you mean exactly by collaboration? Is it collaboration among banks/financial institutions? Is it collaboration between banks and fintech/technology providers? Is it collaboration between banks own subsidiaries?

    1. By collaboration, I mean collaboration between banks, and between banks and fintechs/technology providers. Banks need to collaborate on industry issues that are best solved as an industry rather than individually – particularly the case for financial crime measures such as AML, sanctions, fraud, KYC and cybersecurity, and also for cases for consistency in consumer experience such as identity, authentication and open APIs. Banks should collaborate with fintechs/technology providers to make best use of new technology and innovative ideas for the benefit of their large customer base.

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