The world of financial technology, also known as FinTech, is pushing the boundaries of how people exchange money — impacting everyone from mammoth banking institutions to individual consumers. On December 7, four finance luminaries joined us at General Assembly’s NYC headquarters for The Future of Finance, an intimate panel discussion exploring innovations in the financial sector.
The universal takeaway: Companies and leaders who aren’t paying attention to FinTech’s breakthroughs will be left in the wake of a revolution that is transforming a traditionally rigid industry into an agile economy driven by technological advances and open collaboration.
Featured speakers Scott Roen, Liana Guzman, Prasant Chunduru, and Matt Joseph — executives from BlackRock, Blockchain, HSBC, and BNY Mellon, respectively — and moderator Michael del Castillo, reporter at Coindesk, shared strategies and insights with a packed house of finance professionals and the General Assembly community.
Here are the top five insights from the evening:
1. There is a pre-FinTech world and a post-FinTech world.
There has been noticeable change in finance culture over the past five years and it’s all driven by technology. For example, the integration of APIs (application program interfaces) allow companies to use third-party technology to follow breaking news that informs market decisions. Code repositories like GitHub allow engineers to share code both internally and externally, enabling quick implementation of new technology while magnifying the output of an engineering team. Blockchain technology, a secure database that keeps a public ledger of transactions and allows companies to interact directly, is being used to cut costs and lower the chance of fraud.
Matt Joseph, head of the Jersey City Innovation Center at BNY Mellon, cited a shift in how big banks deal with FinTech companies, who have historically been seen as outsiders in the financial sector. Before, the strategy was simple: Ignore them. Now, with FinTech companies exhibiting huge growth potential by paving new paths with data science and more, large financial institutions are reevaluating when to ignore, when to partner, and when to acquire.
2. Put customers at the center.
Consumers have come to expect instant gratification and incredible experiences from products and brands. Interacting with digital financial tools is no different, and forward-facing financial institutions have elevated their customers’ experiences because of changes in today’s digital landscape. Think about how easy it has become to deposit a check by snapping a photo on your phone or linking Apple Pay to your checking account — no more deposit slips or trips to the bank. Consumers are encouraged by ease of use, which builds brand loyalty (and revenue).
Prasant Chunduru, manager of FinTech partners and strategy at HSBC, mentioned that as customers put more value on their time, banks aren’t only competing for attention with one another, but also with a broad range of engaging outlets like Facebook and Google that offer utility, connections, and distraction. User experience has to be enjoyable and efficient to stay competitive.
3. Regulators actually love blockchain (yes, you read that correctly).
Regulators care about transparency above all else, and the cryptocurrency movement has brought the potential for greater transparency thanks to blockchain technology. Because blockchain’s ledger of transactions can’t be modified, regulators are excited by its potential.
Liana Guzman, VP of marketing at Blockchain (a software development company that provides Bitcoin wallets), explained two systems of implementing blockchain technology for Bitcoin: custodial and non-custodial wallets. Custodial wallets act as a vault that resembles a traditional bank, both structurally and transactionally. Non-custodial wallets put the power and security in the hand of each consumer by enabling them to hold their own bitcoin, effectively transforming each consumer into his or her own bank. As an added bonus, hackers tend to be less interested in non-custodial wallets because it requires more work to hack into each individual user’s wallet than to break into a larger, unified system.
Why do regulators like this technology? It has the potential to enable a more secure and transparent way to bank in the digital world. The Office of the Comptroller of the Currency is still figuring out how to regulate these new systems, which you can read more about here.
4. Getting hired in finance today requires passion and digital skills.
How do you think Blockchain hires their developers? According to Guzman, the company’s CEO will often cruise GitHub at 3 a.m., spot impressive code, create a roster of talents, then investigate to see what makes a candidate stand out.
All of our panelists agree: While their companies are looking for digitally talented candidates, technical skills are just the first barrier. Passionate people who are product-focused, care about growth, and continually develop their skills are the candidates whose resumes make it to the top of the pile. This recruiting method has resulted in the development of innovative products like the Thunder network, which facilitates secure, trustless, and instant payments.
Guzman mentioned that Blockchain loves the people who are willing to take a class after hours (as evidenced by the company’s hiring of three General Assembly graduates). Scott Roen, managing director of global digital at the investment firm Blackrock, looks for what he calls “beachhead employees”: passionate trailblazers who attract other high performers.
5. Watch out, blockchain — there’s a new FinTech favorite in town.
While blockchain is, of course, still important to FinTech’s future, it’s not the only technology that will be getting attention in the coming years. Coindesk’s Michael del Castillo ended the night by asking our speakers to answer to the question, “You have $10 million to invest in Fintech: artificial intelligence (AI), blockchain, or cloud computing? Where are you putting your money?” The resounding reply: AI.
General Assembly’s financial services practice helps companies navigate these paradigm shifts by sourcing, assessing, and training the digital talent they need to continue and grow their success. Email firstname.lastname@example.org to learn more.