I’m spending a few days this week at the Money2020 conference in Copenhagen. It’s Europe’s biggest Fintech event and, as such, it’s a great place to learn about the latest goings-on in the sector and what they mean for the industry.
The opening keynote sessions focused on the future of banking, asking what services banks will be providing in the future. We heard from Barclays, Rabobank and BBVA on where they see the model role of the bank in this digital-enabled world.
Clearly a core part of the role continues to be offering financial services – current accounts, savings, loans and payment functions – as well as providing information on where and how customers spend their funds and offering advice on financial matters. But is this enough to retain the direct customer relationship in the future?
A complete financial solution
Fintechs are in a good position to provide many of these services, but often they stick to just one area and focus on providing that really well. But consumers and managers in SMEs are often not that interested in spending time finding all the best services from different providers, so banks could provide an aggregating function – delivering their own products alongside some Fintech-provided services to offer consumers and SMEs frictionless access to a complete banking solution.
This is one example used in the presentations at Money2020 of how banks can retain relevance to their customers. Another view is that they can use their wide range of relationships to provide connections across the network, bringing together corporates, SMEs and consumers.
Where a corporate is looking to build relationships with SMEs, the bank can provide the trust needed to achieve connections across the world. Where consumers are looking for specific services, the bank can provide vetted and assured access to SMEs. So in these situations, the bank is a trusted broker of services.
Becoming a trusted partner
That trusted relationship may go further. For instance, Rabobank has specialized in banking services in the agriculture sector and now enables farmers to get agricultural advice as well as the financing for buying a new tractor. Using its connections for more than purely financial services helps create a deeper relationship and a better experience for customers.
Lastly, Barclays showed how branches can continue to play a role in the local community by acting as a hub for services for the local community, perhaps teaching people how to participate in this digital world or enabling the next entrepreneur to plan how to start their business.
Later sessions have covered topics like ‘are financial services being unbundled or bundled?’ and whether banks can upgrade their technology fast enough to survive – but those are for a future blog.