Blog | August 25, 2017
Breaking Down the WEF FinTech Report
BY The Sensa Team
The World Economic Forum pulled together an exceptional group of industry experts to collaborate on a three part series evaluating impact of FinTech on the industry. The tldr on the report is simple:
While fintech companies had changed the game they had not dominated it – in fact the ability of larger players to co-op that innovation limited the gains made by these new entrants. Still, the pace of change and barriers to entry mean the landscape remains fluid.
We think this is likely to continue and have written as such previously.
Still, it is worth the read and the time. The outreach involved over 150 interviews and 10 workshop sessions with some of the brightest minds in the space.
The first phase looked at The Future of Financial Services and created the foundation for discussion including the taxonomy for fintech innovation, potential innovation paths and the implications on different players in the financial services sectors.
The report identifies eight disruptive forces to keep an eye on:
- Cost Commoditization
- Profit Redistribution
- Experience Ownership
- Data Monetization
- Bionic Workforce
- Systemically Important Technology
- Financial Regionalization
The WEF goes on break these down in some detail. If this is your space this is your type of read.
As you might imagine, we are had a particular interest in the platforms and bionic workforce areas given we have a platform on which banks create intelligent applications to make their workforce orders of magnitude more efficient.
The WEF’s definition of a platform is different from ours – they see it as something multiple financial institutions can access and build upon whereas we see it as something that multiple applications within a financial institution can ride, but each financial institution has their own copy.
This is born out of our belief that over the next five to seven years, that all applications need to become intelligent – if they don’t they will cease to exist. The prospect of a bank buying one intelligent application for churn, another for credit risk monitoring, another for credit scoring, another for stress testing, another for conduct risk and another for AML makes little sense. A platform designed to scale multiple applications and scale the compute necessary to support those applications is what is needed.
As for making workforces “bionic” – we are in total alignment (they did, afterall, list us as case study).
While there will certainly be robotic process automation – that is a different subject. We think for the vast majority of tasks, intelligence will become a transparent element, the applications and interfaces that humans interact with will make them far, far more efficient, effective and intelligent by presenting them with answers not questions. This will accelerate everything from alpha generation, beta management and omega forecasting.
Again, kudos to the WEF on such an ambitious effort.