In my recent guest blog post, The 6 biggest trends in #Fintech today, on Chris Skinner’s The Finanser website, I explore six examples of innovation and change happening in financial services. Those examples include artificial intelligence (AI) and cognitive computing, biometric authentication, blockchain, chat applications, Internet of Things and voice recognition.
With technology changes happening at warp speed, I decided to ask some key influencers in financial services to share what they believe is the most exciting change to anticipate for #fintech in the coming year. Read on to see what Cherian Abraham, David Gerbino, Brett King, Sebastien Meunier, April Rudin and Bill Sullivan had to say.
The networks and banks I watch closely are now reconciling with the truth that a traditional approach to banking and payments as wholly curated experiences within a canvas owned and operated by the provider has failed to translate into mobile. That approach also has failed to scale alongside the diversity of end points that exist today for consuming payments or other services. Further, the end points are now owned by brands that have little to do with managing money, which can be exciting as well as daunting for a traditional bank.
In that scary, unknown landscape against competitors both old and new, differentiating oneself will hinge on a bank’s ability to find the right talent, empowering them with direction, investment and the willingness to learn through failure. I expect commitment to modernize the core banking infrastructure to continue to be a significant share of overall investment. Initiatives picking up pace are a well-thought-out platform strategy that allows a means to provide fettered access to customer data and bringing trust and identity to interactions elsewhere.
The sad truth is that traditional retail and business banking has been broken for decades. The power of artificial intelligence, blockchain, cognitive computing and learning algorithms are expected to deliver transformative financial services that the computer and smartphone eras have failed to deliver.
In financial services, we see the ultimate potential of cognitive businesses. AI, predictive analytics, smart contracts and the use of blockchain technologies all have the ability to completely reshape the fundamentals of advice, asset management and indeed products and services themselves. Cognition and AI are expected to eliminate the need for more than half of the existing financial services workforce, but in doing so will create smart, responsive financial services that fit your life in real time better than any human or branch ever could.
I am excited by the opportunities created by the combination of technologies. For instance, the combination of mobile technology and blockchain technology allows delivering micropayments and micro-insurance services to underserved populations. In the insurance industry, combining connected sensors—wearable devices, connected homes, drones, and so on—with advanced data science—machine learning—will enable a dynamic modeling of risks. Simple AI coupled with automation allows for Robotics Process Automation (RPA): computer software—bots—can collect and extract knowledge, recognize patterns, learn, adapt to new situations and automate human tasks with a significant impact on the financial services workforce. I think we will see even more convergence in the future.
It’s the most exciting time for wealth management and other financial services to embrace cognitive solutions and analytics instead of sitting on the sidelines. 2017 will mark a change from listening to implementation. Everyone can benefit from that development—both end clients and financial services firms. #Fintech solutions such as IBM Watson client insight and others are available at the enterprise level to equip advisors and other client-facing teams with the cognitive tools to understand their clients and provide customized solutions.
One of the biggest challenges facing the wealth management industry is balancing the importance of the personal relationship clients have with their wealth managers and high net worth individuals (HNWIs) who demand to access their wealth relationship digitally. Capgemini’s World Wealth Report 2016 found nearly three-quarters of HNWIs globally—approximately 90 percent for the emerging Asia-Pacific and Latin America markets—noted the significance of the digital maturity of their wealth management firm when deciding to increase or decrease their assets with their firm. Similarly, wealth managers are demanding better technology tools to meet their clients’ increasing demands. They are also looking to free up their time on higher value-add activities to meet their clients’ holistic wealth needs.
I look forward to IBM Insight at World of Watson 2016, 24–27 October 2016, at Mandalay Bay in Las Vegas, Nevada, for the opportunity to hear thought leaders, meet peers and experts, and glimpse the future of the financial services industry. If you can’t physically attend the conference, be sure to watch the livestream broadcast from IBMGO.com. And learn more about how adding cognitive capabilities can enhance the banking, insurance and wealth management industries.
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