Another year (nearly) over

It was all change at IBS Journal and IBS Intelligence this year. I joined as Senior Editor in February (having previously been Group Editor of rival banking technology title, FStech). Just in case you missed my debut Editor’s Letter, which can be found in the March issue of IBS Journal, I have almost 20 years of experience in journalism, during which time I have held senior editorial positions at and contributed to a number of business and technology-related publications. At FStech, I covered various financial sector technology topics, and my main areas of expertise include FinTech, core banking systems, Bitcoin and the blockchain, the European, US and Australian retail banking sectors, mobile payments and challenger banks.

As I’m sure you’re aware by now, IBS Intelligence has become a division of Cedar Management Consulting International, a leading global management and technology consulting practice. So, new owners, new Senior Editor, new Senior Reporter (congrats to Alex Hamilton who was recently promoted from the position of Reporter) and also this year IBS Journal underwent a major redesign. Out went the front cover stories, replaced by a more modern take on the magazine’s contents. And in came a number of new sections, with an increased focus on FinTech, including Startup of the Month (which has proved to be particularly popular), The Big Interview, Who’s Been Saying What? and The Month in Numbers. Some of our rivals have ditched their printed editions, but here at IBS Intelligence the magazine continues to be a major part of who we are.

#Brexit good for UK #FinTech

Behind closed doors in a small office, off an nondescript corridor, in a rather large building on Rue Wiertz in Brussels, Belgium a hushed conversation took place last month. Shortly afterwards a piece of European Parliamentlegislation was quietly shelved. It carried the rather dull title of “Directive 2009/125/EC” and it was one of the most dangerous documents in Europe!

A vision of the future - and it has to be near term if you want to compete

Immediately following the 2008 crash we should have been at the peak of regulatory change. Indeed, there were some very rapid responses, such as the 2009/2010 UK liquidity regime.  The mountain of reform needed was far greater than initially understood, ranging from structural change to Basel III.

As a result of the size of the change needed, it has been slower. Bank business model changes have arisen as a result of the redefinition of capital, the meaning of high quality and, of course liquidity. In addition, the amount of capital reserves and liquidity have increased.  But now that Basel III is largely in place, is the avalanche over? 

Three key steps banks must take to react to fintech innovation

As the technology available to consumers and businesses alike continues to evolve, it’s unsurprising to see the financial sector – one we all rely on throughout our lives – beginning to innovate alongside the rest of the business world. A major element of this is the growth of the fintech. This sector has grown rapidly; so much so that 35 per cent of the UK’s online population has used at least one fintech product.

Banking is a battlefield

• For anyone who wasn’t around for the 80s, any karaoke bar experience virtually guarantees that the Pat Benatar tune 'Love is a Battlefield' comes to mind when anything is called a 'battlefield': banking included.

Sad thing is, when it comes to core banking systems, legacy status means any claim of 'we are young, we are strong, no one can tell us we’re wrong' is laughable at best, an utter lie at worst.

Application lifecycle management: moving from traditional to agile

Organisations are under an ever-increasing pressure to restructure their teams and processes to match accelerating market dynamics and release faster applications and services; faster release cycles require developers, testers and performance engineers to work in parallel. In addition, they struggle to have visibility and insight across different projects and into the work of distributed teams.

Deploying code and data with manual processes throughout the application development lifecycle are error-prone, expensive and time consuming. Moving code through development environments to Quality Assurance, then pre-production before going live, usually makes up 50% of the delivery effort. Managing of heterogeneous infrastructure of virtual, physical and cloud environment is a tedious and laborious job. 

Customer experience in fintech land

My main thesis for the financial services industry is that finserv = fintech. That is, all participants will have to behave like tech companies and focus on technology, data and customer experience.

Talking about customer experience I had a poor one recently with the bank I bank with – I wish this bank no ill will, yet I would love for them to become service-oriented.

The death of bank products has been greatly under-exaggerated

Source: Moven

Since 2005 I’ve been predicting the decline of branch banking. For almost ten years I fought bankers who decried my assessment that branches would cease to be the most important channel in banking, to be replaced by far more efficient mechanisms for revenue generation and relationship. Today the discussion is increasingly resorting to a sort of desperate plea — 'but branches aren't going to die completely, are they?' No one is saying branches will grow.

The UK, the US, Spain, and a host of other countries are seeing the lowest number of bank branches in decades. For the UK you’d have to go back 60 years to find lower numbers of bank branches than we have today, and 2014 saw the use of bank branches fall 6% in a single year — the biggest reduction ever. 

2015: The year fintech really took off

I have been tremendously excited to see how the FinTech sector as a whole has moved up to a whole new level this year. And what particularly excites me is the way two particular groups have seemed to really recognise the role of fintechs in underpinning economic growth.

By Anders La Cour, CEO of Saxo Payments

Capital markets: Buying habits signal a shift towards the cloud

62% of technology projects in capital markets over the last year have cost less than $500,000, with 45% having a Capex of less than $250,000 according to our latest research.

This came as somewhat of a surprise. 

My conversations with fintech companies serving capital markets have been consistent – times are getting better. Institutions are spending again and, although pressures are there, confidence is returning. Regulatory demands, technical upgrades and changing customer requirements were supposed to be pushing firms to spend. So, in a market widely known for major, wholesale technology change, this level of spend marks a real shift. 

Core banking system mistakes, masterstrokes and predictions

• My previous blog, looking at the evolution of the core banking systems sector over my 20+ years, seemed to be well received and prompted quite a few memories and opinions among my peers. So I decided to do a second ‘Farewell to Cedar/IBS’ piece as I weigh up my next steps in the sector.

These are my ‘Top Five’ mistakes and masterstrokes and ‘Top Ten’ predictions. Let me know if you agree, any other worthy contenders? It would be good to get a debate going!

By Martin Whybrow, founder of IBS Intelligence

The core banking systems market: then and now

• As I prepare to leave IBS, the company I set up 24 years ago, it seems a fitting moment to take stock of how far the core banking systems market has come in that time.

By Martin Whybrow, founder of IBS Intelligence

To branch or not to branch... is that the right question?

• The quest to justify banking's oldest distribution channel continues despite the wonders of self-service automated kiosks and the growing adoption of mobile banking. 
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• The arguments for and against branch banking are well publicised these days, and yet we continue to debate the subject year after year.

Banking and financial services technology world, unite!

IBS Intelligence has launched a new global platform – IBS Chat – dedicated to increasing conversation and knowledge sharing within the financial services industry as a whole.

IBS Chat aims to bring industry participants together to exchange views and ideas, ask and answer questions on all matters relating to banking and financial services technology.

Banking technology in Asia: the place to be

Everyone who is anyone in the banking software space wants to do business in Asia, and for a good reason: the region is as buoyant as ever.

The established markets are getting even more sophisticated in their technology consumption (if you are in Singapore, why not try out an NFC-enabled wristband to pay for your commute, travel, shopping and eating out?).

Is it time to debate the Digital Only business model?

For many bank executives today, there are very real concerns about the impact on their business models by so called digital disruptors. The question is how long will that disruption last, and is being digital enough of a differentiator to create large corporate casualties?

If you are like me, then you must be getting tired of seeing messages about 'Unicorns' and how Uber owns no taxis, and AirBnB has no hotels blah, blah, blah. 

Sibos: day two round-up

@Swift

Day two of Sibos continued the theme of collaboration, with more focus on standards, market infrastructures and new technologies under the spotlight.

Sibos: day one round-up

@Swift

Sibos 2014 kicked off in Boston with the focus inevitably on regulation, standards and the build-up to the much anticipated plenary which revealed Swift's pricing strategy.

Why are P2P payments slow on the uptake in the US?

© www.zafin.com

After speaking with Chris Burfield from FIS about the vendor’s recent person-to-person (P2P) payments project at US-based Everbank, a question arose: why are these types of services slow on the uptake in the US?

Have European banks given up on core banking system replacements?

© www.itrw.net

Despite the emergence of new technology and increasing competition, it seems the replacement of core banking systems is not on the agenda for European banks. Instead, banks are investing in niche IT projects to not only maintain their existing systems, but to introduce incremental changes, which can provide a quick return on investment (ROI) and meet their business and consumer needs.