The 2016 Swift Business Forum in London proposed “build the future” as a theme, bringing together over 1,000 delegates to discuss the most pressing challenges and opportunities in the financial services industry.
Swift’s chief executive of the Americas, the UK, Ireland and the Nordics, Javier Perez-Tasso, opened the conference with a speech focused on fintech, and how the increasing competition in that space makes it hard to understand who the winners will be. “[Fintech start-ups] can build from scratch and deploy the latest technology, but they also need to have the power of distribution. The winners will have to combine both dimensions, harnessing business innovation and technology while maximising distribution and leveraging the customer base,” he said. He also stated that correspondent banking is facing a similar challenge: while its business model has hardly changed from when it was created, it now needs to rejuvenate its current system, drastically improving predictability, speed and transparency.
The innovation challenge is one that banks should feel confident in addressing. As Eileen Burbidge, partner at Passion Capital and fintech envoy for HM Treasury, mentioned in her keynote speech about collaboration between banks and fintech start-ups, financial services have always been technology leaders. “Financial services and fintech are not mutually exclusive. It is important to think about the ecosystem as one big thing,” she said.
With user communities increasingly looking for flexibility in terms of how they access and participate in training courses, e-learning is the future. Dana Brants, Swift
Collaboration was also championed by Blythe Masters, former JP Morgan executive and now CEO of Digital Asset Holdings. She painted a gloomy yet realistic picture of banks’ challenging post-financial crisis environment, defined by lower return on equity. Masters invited banks to see an opportunity in entrepreneurs proposing new financial services products. “[This is] one of the first times in history that it has been possible to think about mutualising and sharing financial infrastructures in a way that security is enhanced relative to the status quo, which is what blockchain is about,” she said, highlighting how the cost-saving prospects are substantial, in the order of 30 to 50%.
To the question of why this has not happened already, she pointed to the “gigantic” legacy system, as well as three more obstacles represented by the regulatory environment, the need for a network effect and to agree on standards to facilitate it.
Swift, as an example of an organisation born out of the collaboration of banks interested in creating a better way to do business, is working on several initiatives to enable simplification and collaboration across financial services. The Business Forum presents an opportunity to highlight its work, from the global payments innovation initiative, to a white paper assessing challenges and opportunities for industry-wide adoption of distributed ledger technologies, to the newly-launched SwiftSmart e-learning service.
SwiftSmart is an interactive cloud-based platform to support remote training with digital courses and social learning capabilities, to encourage peer interactions across the Swift community. “Education best practices have significantly evolved over the last 30 years,” said Dana Brants, Swift head of services. “With user communities increasingly looking for flexibility in terms of how they access and participate in training courses, e-learning is the future.”
The event was hosted in the Tobacco Dock warehouse in East London, halfway between the City of London and Canary Wharf – a place that reinvented itself throughout the decades, from storing tobacco to holding corporate and commercial events, and the perfect symbol of the legacy v. innovation challenge banks currently face.