Sorry Blockchain, Any Joe Schmoe Shouldn’t Be Able to Start a Bank
Safety issues with some new, disruptive business models highlight why regulations exist. Surely the same goes for firms that hold our money.
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Building the Foundations for a Scalable Ethereum
Do events like The DAO collapse prove blockchains need formal governance? #Blockchain analyst Josh Stark argues that it’s too early to tell.
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Fintech und die Verantwortung der Medien
Sobald die #Medien ein Thema für sich entdeckt haben, schnellt die Zahl der Beiträge, die sich mit diesem neuen Phänomen beschäftigen, in die Höhe. So auch bei #Fintech. Insofern also nichts Neues. Problematisch wird das dann, wenn die Medien die nötige kritische Distanz vermissen lassen. In letzter Zeit haben sich die Fälle gehäuft, bei denen Unternehmen von zahlreichen Medien förmlich “hochgejazzt” wurden. Beispielhaft dafür sind LendingClub, The DAO und der Themenkomplex #Blockchain.
Wie die Studie Wirtschaftsjournalismus in der Krise &8211; zum massenmedialen Umgang mit Finanzmarktpolitik im Jahr 2010 feststellte, unterließen die Medien in ihrer Gesamtheit, die Entwicklung der Finanzindustrie in den Jahren vor Ausbruch der Krise kritisch zu begleiten bzw. zu hinterfragen. Die Autoren kamen zu dem Ergebnis:
Die kritische Darstellung der neuen Finanzbranche, ihr Wandel von einem Dienstleister zu einer Art Finanzindustrie, die Folgen daraus für das Gemeinwohl, also die Perspektiven von Volkswirtschaft und Gesellschaft waren dagegen kein Thema. Wenn berichtet wurde, dann über die neue Finanzindustrie als Zeichen von internationaler Wettbewerbsfähigkeit und als Quelle für Gewinne und Arbeitsplätze am Standort Deutschland. Hier handelt es sich um eine Perspektivenverengung mit enormen Wirklichkeitsverlusten, die als schwere journalistische Verfehlung einzustufen ist.
Caleb Pershan beleuchtet in The Troubled Tale Of Lending Club And The Problems Created By Glowing Tech Press die Wirkmechanismen des Tech-Reporting am Beispiel von LendingClub. Im Silicon Valley, wie überhaupt im Tech-Sektor, gehe es häufig nur noch um Erzählungen, Narrative. Ob und inwieweit diese mit der Realität im Einklang sind, ist eher nebensächlich; Hauptsache die Botschaft ist cool: Die Welt wird an der neuen Technologie genesen. Probleme, die uns heute noch unslösbar erscheinen, werden sich in nichts auflösen. Die Gesellschaft wird gerechter, die Menschen werden glücklicher: Alles wird gut.
Image credit: Pixabay
Pershan erwähnt den Bericht Access, Accountability Reporting and Silicon Valley des renommierten Nieman Lab. Darin schildert Adrienne Lafrance an verschiedenen Beispielen die Veränderungen, die sich in den letzten Jahrzehnten im Tech-Reporting ereignet haben. In den 1980er Jahren, als Technologiekonzerne wie Apple noch Exoten waren, war der Zugang zu den Exponenten der Tech-Szene leicht und die Atmosphäre offen, wie bei den sog. Homebrew Meetings:
John Markoff, a long-time #technology reporter for The New York Times, remembers the original culture of Silicon Valley as open and collaborative—even welcoming to journalists. In the early ‘80s, Markoff had access to the Homebrew Computer Club, a legendary hobbyist group whose members included the technologists who would go on to run Silicon Valley. Steve Wozniak, the co-founder of Apple, first shared his design for the Apple I computer at a Homebrew meeting in 1976.
Diese Kultur änderte sich in den nächsten Jahrzehnten drastisch:
Over the next few decades, the people running the tech sector went from occupying a niche cultural and economic space to being some of the most powerful business leaders on the planet. And the culture and influence of Silicon Valley changed dramatically. “Early on, Apple was fringe,” says Kevin Kelly, founding executive editor of Wired magazine. “It was nerdy-techy. The difference now is that these companies are the most profitable companies in the world. This is no longer the sideshow; this is the main show.”
Sobald man in die Sphäre der Technologiefirmen und Startup-Szene gelangt, treten manche Fragen fast schon automatisch in den Hintergrund. Es scheint so, als betrete man eine andere, heile Welt, wie David Streitfeld, Tech-Reporter bei der New York Times, berichtet:
“There’s a sense, in too much tech reporting, that when you cross the bridge into Silicon Valley, you’re in a world where the old rules of journalism don’t apply. One of the biggest clichés of Silicon Valley is when they say, ‘It’s not about the money. We just want to change the world.’ Sometimes that even may be true. But that’s a reason for better coverage, not weaker.”
Dass aufstrebende Fintech-Startups sich mit kritischen Fragen schwer tun, durfte das Handelsblatt bei Number26 vor einiger Zeit erfahren.
Um die Defizite im Tech-Reporting zu beheben, sei, so Pershan – wie sollte es auch anders sein &8211; eine disruption nötig:
Possibly a good way to disrupt this system is to hire dedicated reporters with a narrow focus, such as on a single company, investigative journalists who can cultivate sources outside that company’s PR department and beyond the scope of its own self-serving narrative.
Weitere Informationen: New Banking und die Rolle der Medien
Dieser Artikel ist zuert auf dem Bankstil Blog erschienen.
Featured Image: Man Reading via Pixabay
The post Fintech und die Verantwortung der Medien appeared first on Fintech Schweiz Digital Finance News – FintechNewsCH.
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U.S. Bank Partners with Roboadvisory FutureAdvisor [VIDEO]
U.S. #Bank has partnered with investment advisory firm #FutureAdvisor to provide automated, or #robo-advisory services to its clients at U.S. Bancorp Investments, an affiliate of the bank. FutureAdvisor was bought by the world’s largest investment manager, BlackRock, about a year ago. While roboadvisors have their advantages in terms of cost,Read More
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‘Bankcoin’ Is Not Currency, It Is a Digital Vehicle to Move Money
It was announced this week that four of the world’s #banks—Santander, UBS, BNY Mellon, and Deustche Bank—are collaborating, along with brokerage firm ICAP, in order to produce what they’re calling a “utility settlement coin,” or USC, run on #blockchain #technology, originally the rails beneath #bitcoin and now the talk of the financial, corporate,Read More
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Why should bank boards care about APIs?
The discussion around digital transformation in #banking has long revolved around the nexus of technologies that are globally driving this change. Technologies such as mobile, social, big data and cloud computing are surely impacting significantly all industries, but for financial services there are other silent technological revolutions taking place that, at the very least, can massively accelerate the technological disruption occurring in the sector.
If mobile, social, big data and cloud computing are the core technologies of digital transformation, for financial services the emerging underlying substrate are APIs (Application Programming Interface). Now, APIs have been around ever since someone wrote a piece of computer code that was meant to be reused by someone else and are common parlance in IT. However, the threat of fintechs and regulations such as the revised Payment Services Directive (PSD2) are elevating the IT lexicon to board-level discussions. Bank boards, in many cases for the first time, are being exposed to IT concepts and jargon that, not only they cannot afford to dismiss, but in effect they need to deeply understand as it becomes a key part of the future of competitive advantage in a digitally transformed industry.
Why should #banks care about APIs?
APIs expose banks’ products and processes for use by third-parties. Since banking products are inherently digital and processes already are or can largely be automated, the development of an #API strategy drives three key advantages for banks:
- it enables banks to become a part of an integrated and larger value-chain;
- it offsets the threat of new entrants by establishing from the onset a “coopetitive” position for traditional banks;
- it drives #innovation from within.
I. Vertical disintegration of banks and ecosystem integration
The various impacts of globalization and #technology in the financial services industry led to the emergence of niche providers, specializing in key activities of the banking value-chain. Most traditional banks tend to be vertically integrated organizations with relatively fixed cost structures and, as transaction costs decline, some of the key activities in the banking value-chain suddenly become cheaper to procure externally than to execute internally. As a result, we see a move to vertically disintegrate these activities and outsource them.
With the threat of fintechs and neo-banks looming, an API strategy enables banks to streamline their internal value-chain, becoming at once leaner and more focused, while at the same time, transparently integrate themselves into a broader ecosystem exploring new revenue streams and business partnerships. For instance, consider the ability of a car dealership to provide an immediate loan for a customer at the point-of-sale. In this scenario, the cost of sales would be handled by the car dealership. From the dealership standpoint, they would be able to close a sale on the spot providing great value and a great experience to the customer. Also, consider the fact that this is a contextual sale, where additional products, such as auto insurance with multiple coverages, can (and should) be recommended with increased probability of acquisition by the customer. Now, I’m not naïve to the point of disregarding the many existing hurdles of this or other similar scenarios, such as compliance and legal issues. However, even compliance and legal are prone to disruption by APIs and automation as well as by self-regulating technologies such as distributed ledgers and smart contracts (but that’s a topic for another post).
II. Healthy coopetition with fintechs and neo-banks
There’s no longer any question about the threat that fintechs, neo-banks and non-banks pose for the future of traditional banks. After the boom of late 2014, the #fintech “movement” came of age during 2015 and is now competitive across all categories – lending, personal finance, payments, retail investments, institutional investments, equity financing, remittances, consumer banking and more. CB Insights reports that global fintech investment is rising and that Q4 of 2014 was the busiest of the last 5 years with a total of $3.1 billion invested across 214 deals – that’s an average of $14.5 Million dollars per deal. There’s also increased acquisition activity, mostly by established fintechs rather than by traditional banks.
Additionally, regulations such as PSD2 will inevitably push traditional banks into the playground of fintechs and neo-banks. Strategically, it’s a dangerous place to be in for traditional banks, since most of them are not yet ready to compete with these new enterprises in their own ground. However, with the right invesments, such as APIs and open banking, banks are starting to develop the resources that’ll be a key part of the answer to long-term prosperity in an evolving and growing eco-system. Here are four key areas of cooperation and competition with fintechs and neo-banks that banks can explore in the course of their API/open banking strategy:
- Replace costly parts of the bank’s value chain with services provided by fintechs and neo-banks – this can reduce the bank’s cost structure and improve cost-to-income ratios;
- Increase the reach of the branch network through partnerships with non-traditional and specialized players (car dealerships, realtors, etc.) and increase the breadth of products by integrating specialized products from fintechs and neo-banks – this can increase share-of-wallet and sales;
- Provide OEM financial products and services, acting as the backbone for neo-banks – this can improve operating income;
- Traditional banks still have a lot of infrastructure that fintechs and neo-banks don’t have and do not want to have as it will hurt their business model. Banks can provide back-office services that are too costly for fintechs and neo-banks to develop – this can increase the interdependency of these players on the bank, mitigating the risk of their threat.
III. Looking within for innovation
It’s true that when talking about APIs and open banking, we usually address it from the standpoint of an outward-facing competitive advantage that can enable incumbents to compete and/or partner more effectively with fintechs. However, looking within traditional banks, we can also find areas where APIs and an open platform can help drive increased performance and efficiency.
To be fair, through the years banks have made significant investments in IT and in services platforms, primarily driven by interoperability and modernization rationales. The problem with these approaches is that they have mostly been IT-led and for a long time there wasn’t really a great business justification for them so they weren’t typically discussed from the business standpoint as a key strategic investment. Where these investments occurred, banks are now taking a new look at their IT assets and resources and realizing that they are better off than they actually thought. Some of those past IT investments have become key in this new digital economy, particularly when it comes to simplifying business processes and products.
Internal APIs are also key to driving innovation from within. They can work as a sandbox for internal development of ideas before external exposure to partners and others. In this area we see several banks hosting internal Hackathon events, pairing business and IT people in the development of new digital products and in the automation and simplification of internal processes. Internal innovation is key as the rate of change accelerates in the industry. Simpler processes, new innovative products, and a leaner organization will drive growth and efficiency for traditional banks. I believe that in the short term, we’ll see an increased focus in using APIs to build resilience into the banking business model, whether through innovative products and services, or through the ability to replace internal processes and services with external providers.
[linkedinbadge URL=”https://www.linkedin.com/in/josealmeida” connections=”off” mode=”icon” liname=”José Almeidaos”] is digital advisor at Microsoft and this article was originally published on linkedin.
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We Look at Biggest Fintech VC Deals of 2016 To See Where the Insurtech Puck Is Going
Image source We looked at the 30 #biggest VC #deals in #Fintech for #2016 (courtesy of CB Insights Pulse of Fintech Report) to see where the #InsurTech #puck is #going to. The answer is blindingly obvious when you #look at the 3 out of 30 that we tagged as primarilyRead More
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Chase Debuts Digital Car-Buying Service
#Chase launched a new #fintech offering, Chase Auto Direct, to allow customers to shop for a vehicle and secure financing through the Chase.com website or app, the company announced yesterday. Consumers can then close the deal at one of Chase’s network of 14,000 dealerships.
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Hyperledger Blockchain Project Elects New Tech Committee
The #Hyperledger #Project, the #blockchain initiative led by the Linux Foundation, has elected a new technical steering #committee.
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Corporates and Public Administrations Look at E-Invoicing to Cut Costs
Companies are looking at e-invoicing as a way of saving #costs, according to a new survey by Vereon AG, a Swiss conferences, congresses and professional training courses organizer.
An online survey conducted by Vereon found that 65% of businesses believe that the saving potential of e-invoicing is high. 27% see it as a driver for other projects aiming to optimize business processes.
Respondents believe that the biggest challenges in implementing e-invoicing in their organizations are internal resistance (21%), compatibility issues (20%) and lack of information (15%).
Electronic invoicing, also referred to as e-invoicing, is a form of electronic billing often used by trading partners, such as customers and their suppliers, to present and monitor transactional documents between one another and ensure the terms of their trading agreements are being met. These documents include invoices, purchase orders, debit notes, credit notes, payment terms and instructions, and remittance slips.
As corporate enterprises and #public #administrations seek to automate business processes, e-invoicing allows has numerous benefits such as reducing costs, errors and time spent on administration.
Vereon will be hosting the Exchange Summit in Barcelona on October 10 and 11, 2016. The event will provide attendees with the opportunity to learn and share their experiences on a global level. They will also get the chance to meet and connect with experts, thought leaders and professionals in e-invoicing, purchase to pay, e-procurement, supply chain finance, and accounts receivable/accounts payable (AR/AP).
Among the topics that will be discussed, experts will tackle the potential of #blockchain #technology to disrupt the peer-to-peer process, the state of Public Procurement in the EU, as well as the region’s regulatory framework for e-invoicing.
E-Invoicing regulation in Switzerland
In Switzerland, e-invoicing is subject to certain legal requirements under commercial and tax law. The rules require for instance that all VAT relevant e-invoices are digitally signed by one of the four Swiss-admitted digital signature providers.
That said, the Swiss Federal Tax Administration (SFTA) has moved closer to the general EU rules recently and has approved different ways of accepting e-invoices, according to Deloitte Switzerland.
The authority requires that the integrity and authenticity of the e-invoices are assured, and that companies establish an internal control system that allows a constant and reliable audit trail between procurement process, e-invoice and payment. Businesses are also required to establish a new procedure-to-pay internal control process, which is regularly audited.
Many governmental initiatives are currently being implemented, notably by the European Commission. By the end of 2018, public administrations in all EU member states will be required to support e-invoicing and to automatize public procurement processes as stipulated in Directive 2014/55/EU.
Separately, EDICOM&8217;s R+D+i initiative, driven by the European Commission as well, aims at fostering implementation of the European e-invoicing schema between hospitals and laboratories.
The initiative is open to healthcare suppliers and public agencies belonging to any of the EU member states.
In Europe, Finnish #fintech startup Zervant is one of the leading e-invoicing solution providers. Earlier this month, the startup announced a new €4 million funding round to fuel global expansion. This brought the total amount of capital raised to more than €8 million.
Zervant is used by tens of thousands of entrepreneurs all over Europe. Its core markets are Finland, Sweden, Germany, France and the UK. The company’s revenue is expected to grow by 200% this year, according to EU-Startups.
According to Mattias Hansson, Zervant co-founder and CEO:
“There is going to be a tremendous shift towards electronic invoicing in the next 5 years and more accessible financial products for micro enterprises. We want to lead the way in this segment.
&8220;This investment will help us expand significantly and strengthen our position as the leading invoicing service for small businesses in Europe. We will accelerate growth in our current markets as well as expand into new countries.”
Featured image: Online invoicing concept by Bakhtiar Zein, via Shutterstock.
The post Corporates and Public Administrations Look at E-Invoicing to Cut Costs appeared first on Fintech Schweiz Digital Finance News – FintechNewsCH.
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