Driven by digital pressure, traditional banks are learning new tricks

[Shenzhen, China, September 4, 2023] One of the world’s most conservative industries is long overdue for a revamp as competition from fintech startups combines with consumer demand for always-on services, prompting banks to rapidly digitize.

According to one of the many experts interviewed for the #DigitalFinance issue of Transform, Huawei’s thought-leadership magazine, transformation is like “changing a car’s engine and wheels in the middle of a race, without stopping.”

Digital technology could usher in a golden age of digital banking, with artificial intelligence providing financial advice and other personalized guidance to consumers.

“We suddenly have technology with artificial intelligence and things like that to provide a bank account that can actually help you manage your money,” said Brett King, a futurist and author of the book. Bank 4.0.

“Early wallet systems that we see today, like [China’s] Alipay and WeChat pay and Paytia in India and Kakao in South Korea will become AI-powered bank accounts that will truly help us manage our everyday money. This will be a trend we will see in banks around the world, supplementing human advice with AI.

King shares the cover with Dame Jayne-Anne Gadhia, its founder Snoop Money Management program and former CEO Virgin moneyPart of the Virgin Group.

Like Brett King, she extols the potential virtues of artificial intelligence in banking, while warning that banks cannot afford to ignore traditional skills.

“You can’t just use a bank app,” she says. “You have to be able to understand inputs and outputs. This easy access and easier response means we all need to be more accountable.

Dame Jayne-Anne denies banks have been slow to embrace full digitisation. “It’s not as simple as waving a magic wand. It’s complicated, expensive and risky. It’s a big project that people will have to plan for years.

David Brear, CEO of financial services consultancy 11:FS, compared legacy banks and start-ups to a race between the tortoise and the hare.

Brear says the race still has a long way to go, noting that legacy banks still have hundreds of millions of customers around the world, even though fintech hares may be running faster now.

He sees the modernization of banking as a Darwinian battle. “It’s not the strongest species that survive, but the ones that are most adaptable to change,” he says. “What we’re going to start to see is a move towards autonomous money,” where banks automatically move their customers’ money around to deliver the best products and the best rates.

You can find the latest interviews and other content on the transformation page of the Huawei Media Center website.

Godfrey Kemp

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