Artificial Intelligence. Blockchains. Biometric identification. Regulation. Intuitive design. Inclusion. Globalization. Future banks without a balance sheet.
These were all the big topics discussed this week at Money20/20 in Las Vegas and innovation was everywhere, but what was very apparent was that the innovation is occurring at a faster and faster pace.
AI in financial services is rapidly being used for personal finance, risk management, research, forecasting, algorithmic trading and fraud detection. AI involves complex techniques such as machine learning, neural networks and deep learning with both structured and unstructured data to build statistical inferences. Research from Roubini ThoughtLab predicts Financial Services providers plan to double their use of AI, from 17% today to 36% by 2022. At Money20/20, it seemed like everyone was already using AI and speakers were even saying that we need to consider a hippocratic oath for future data scientists given where this technology is headed.
Steve Wozniak from Apple put it into context though, in his Empowerment of Humans in Tech discussion. He said that AI is simulated intelligence today and we’re still a ways from The Singularity. He made the crowd laugh by saying artificial intelligence would be intelligent if you hire the AI, fire the CEO and the company makes more money. Across the many discussions on AI, the take-a-way for financial services companies was that you have to think about rooting deep learning across the entirety of your enterprise. By building centralized teams with AI expertise and sharing capabilities while fostering a culture of innovation you can begin to harness the potential of this technology at scale across a business.
Many FinTechs were showcasing the promises of blockchains and leading the way for traditional financial services to look at this technology.
Several of the discussions on regulation centered around cryptocurrencies and the need for private and public sector institutions to work together to find practical solutions that could harmonize interests. With bitcoin hovering above $5K this was obviously very interesting conversation. In driving awareness and direction toward consensus, regulators talked about the Global Blockchain Council and the Blockchain Alliance as two groups that were endeavoring to bring parties together around this burgeoning technology.
Blockchains were also discussed during the sessions on Inclusion where speakers talked about how this technology was helping women gain much-needed access to financial resources in developing countries. Also, from a regulatory standpoint, the Financial Conduct Authority in the UK discussed their sandbox for FinTech saying that it was working to speed innovations to market and that it was also good for regulators – helping them to better understand what innovative firms are trying to accomplish.
Apple had the closing keynote on Day 1 and they announced payments through iMessage. As they typically do, Apple amazed the crowd with their easy to use demo of payments through simple mobile texting. On Day 2 of the conference, we held a luncheon with Apple to discuss the co-engineering innovations being delivered to market through the Apple & Cisco partnership. We covered network fast lanes, security and collaboration solutions that are delivering innovation today straight out of the box. Learn more about the Cisco & Apple partnership here.
The other narrative apparent across the conference was that the internet was being used for virtually every financial services transaction today, which makes the network more important today than ever before. Intuitive design and contextual commerce are important in developing next-generation financial services applications, but your network core must also be intent based. A network that can make faster decisions, mitigate security threats and manage the unprecedented scale of data and devices to deliver a differentiated experience for your financial services platform. Jason Bettinger, Cisco Global Director of Consumer Industries, made the case for The Network. Intuitive. during the Lunch with Innovators session on Day 3 of the conference. So, if you’re building the Bank of the Future or the next FinTech disruption, you need a network that is built for innovation.
Learn more about The Network. Intuitive.
Excellent recap Joe! Lots of insights from this conference.
One of the interesting items was the stronger presence of community banks than in years past. They want to partner with Fintechs.
Security and compliance were big as well. There were hints that US authorities are trying to shepherd change, notably by hiring more technology savvy staff and more innovative people. There is a very long way to go compared to the freedom of China or India for instance.