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Day to day traditional banking operations will be slow to innovate. Partially due to the regulatory burden as you describe. But also the perception there is lit

by indescions_2017 9y ago

Day to day traditional banking operations will be slow to innovate. Partially due to the regulatory burden as you describe. But also the perception there is little financial upside for the investment. Outside of that however change is happening. And you will see new products coming out of "Innovations" groups operating entrepreneurially. My colleagues at WF and JPMC are busy experimenting with distributed ledger tech, mobile payments, global micro credit, and other "fintech." And the rollout of Zelle, instant peer-to-peer cash transfers, happened in weeks not months. Literally I was invited to participate in a beta program around the beginning of summer and a few days later billboards advertising the service started popping up around town ;)

longerthoughts 9y ago
It's worth stressing your point on perceived limitations of financial upside. I work for what is effectively a fintech business within a large financial firm and this is a constant hindrance to innovation because investment tends toward short term gains. I think it really comes down to how low the bar is set for software used by financial institutions with respect to originality and pushing boundaries. There's simply not much pressure to do extraordinary things because clients are accustomed to such laborious, outdated systems and processes. I hear a lot of fluffy talk about leveraging modern technologies and being pioneers but when it comes to building out teams and buying into exciting projects, leadership can't seem to find their wallets unless a client has specifically asked for something. You mentioned that your colleagues are working on things that break this mold - I won't try to speak for their companies, but in my experience those sorts of experimental projects (e.g. distributed ledger tech) tend to be wildly underfunded and consequently don't deliver much beyond an overblown, hype-building press release.
jdmichal 9y ago
It's probably worth noting that Zelle was mostly a rebranding of an existing service: clearXchange. Or, rather, a branding, as prior to the Zelle name, no one advertised the underlying clearXchange network. I strongly agree with your general point. Just like any extremely large business, there's small sects pushing forward in various ways, while the vast majority toils away on SSDD stuff.

longerthoughts 9y ago

It's worth stressing your point on perceived limitations of financial upside. I work for what is effectively a fintech business within a large financial firm and this is a constant hindrance to innovation because investment tends toward short term gains. I think it really comes down to how low the bar is set for software used by financial institutions with respect to originality and pushing boundaries. There's simply not much pressure to do extraordinary things because clients are accustomed to such laborious, outdated systems and processes. I hear a lot of fluffy talk about leveraging modern technologies and being pioneers but when it comes to building out teams and buying into exciting projects, leadership can't seem to find their wallets unless a client has specifically asked for something. You mentioned that your colleagues are working on things that break this mold - I won't try to speak for their companies, but in my experience those sorts of experimental projects (e.g. distributed ledger tech) tend to be wildly underfunded and consequently don't deliver much beyond an overblown, hype-building press release.

jdmichal 9y ago

It's probably worth noting that Zelle was mostly a rebranding of an existing service: clearXchange. Or, rather, a branding, as prior to the Zelle name, no one advertised the underlying clearXchange network. I strongly agree with your general point. Just like any extremely large business, there's small sects pushing forward in various ways, while the vast majority toils away on SSDD stuff.