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U.S. banking is surprisingly far behind the curve, and hasn’t led the world from a tech or innovation perspective for many decades. The UK on the other hand ha
by avianlyric 3y ago
U.S. banking is surprisingly far behind the curve, and hasn’t led the world from a tech or innovation perspective for many decades.
The UK on the other hand has actively encouraged new banks and new tech. It’s had things like instant, free, payments between personal accounts for almost two decades. Contactless transactions for at least a decade, mobile banking for decades, and government mandated banking API for almost 5 years.
In short, the UK has a very active banking sector that’s been rapidly (for banks) innovating for many decades. So the environment and ecosystem are well developed for further and faster innovation.
In the U.S., it seems banks gave up on tech innovation decades ago, and decided that innovation in fees and punitive treatment of customers was their preferred approach. As a result there just isn’t an environment for new innovation, the incumbents find it much easier to crush competition, rather than compete. Why the same isn’t true in UK (which until recently had remarkably few distinct banks), is probably down to the nature of law and regulation, which gives customers lots of rights, and actively punishes banks that don’t uphold them.
- BurningFrog 3y agoUS banks are very tightly regulated, and the regulators haven't ordered these inventions yet.
- avianlyric 3y agoU.S. bank regulation is a joke compared to the UK and EU. Regulation isn’t the reason US banks are lagging so far behind.
- scarby2 3y ago> It’s had things like instant, free, payments between personal accounts for almost two decades. Thanks for making me feel old I was thinking "it hasn't been anywhere near that long, I remember the rollout like it was yesterday". Turns out that rollout was 15 years ago.
- 8fingerlouie 3y ago> The UK on the other hand has actively encouraged new banks and new tech. It’s had things like instant, free, payments between personal accounts for almost two decades. Contactless transactions for at least a decade, mobile banking for decades, and government mandated banking API for almost 5 years. I think most of those things are EU initiatives, which the UK was a member of at the time. At least we have all of them in Denmark as well.
- blibble 3y ago> I think most of those things are EU initiatives no, only the mandated banking API (which is impossible to get access to if you're a startup or an individual)
- yakshaving_jgt 3y agoI thought we were talking about PSD2, which the European Parliament adopted in 2015. I recall many startups were launched specifically to capitalise on new opportunities provided by PSD2, so I find your comment confusing. What am I missing?
- blibble 3y agothe UK had contactless transactions, free instant payments and mobile banking years before PSD2 (the mostly useless open banking stuff is however due to PSD2)
- yakshaving_jgt 3y agoThat appears to be a red herring. In the article, Griffin is described as: > Their services allow Fintech businesses to integrate banking features quickly and securely. So this is about integration with other FinTech businesses, which I think squarely falls under open banking and PSD2. I'm not sure why you describe PSD2 as "mostly useless". Did you vote for Brexit by any chance?
- 3y ago
- decentsafety 3y agoNot sure if anyone else can comment on prevalent software in banking. But it seems like IBM’s FTM is fairly prevalent. The underlying technology from a glance seems dated (Java 8, bunch of uncontainerized shell scripts running the show) and highly proprietary in the bad ways. E.g the proprietary stack hasn’t seen innovation. Add to that, the same teams deploying this software.