EU policymaker says banks must embrace digital wave
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BRUSSELS, 27 January 2017 – EU Commissioner Günther Oettinger urged banks to continue to stay on the journey to embrace innovation. Speaking to an audience of 200 banking industry technology experts at the second day of the two-day WSBI Innovation Conference in Brussels, Oettinger echoed sentiments by conference participants who concluded that locally focused, customer-driven savings and retail banks face challenges as the digital wave sweeping the financial sector.
Mr. Oettinger, who recently completed a two-year role leading the EU executive body's digital agenda, also addressed policy around digitisation in the financial sector. He noted that the legislative framework should enable innovation while minimizing risk. He noted that it should also ensure a level playing field among financial services providers that includes banks, fintechs and other mature companies seeking to enter the market.
That same morning, WSBI President Heinrich Haasis touched on similar areas related to the importance of digitialisation and banking in his welcoming address. He said: "Digitisation changes the way we look at banking. As the "digital wave" sweeps the planet, old ways of client contact are being replaced by "quick touch" apps. Face-to-face, or "high-touch" customer service is part of that future."
Following the two morning addresses, a hard-hitting panel explored the future of the bank branch. Echoing Haasis' comments, they concluded that the bank branch is rapidly becoming a place where clients come to seek advice and no longer to do transactions. A series of best practices from four WSBI-ESBG members from three continents illustrated how their branches have evolved with digital-led change.
Jürgen Ingels, Founder of Eggsplore, addressed the conference after the first panel, speaking on "From fintechs to tech4fin". A second panel followed, looking at how new technologies can address the financial inclusion challenge. WSBI-ESBG members joined a microfinance analytics firm and an expert from the World Bank Group's International Finance Corporation to explore how with financial inclusion and technology – most notably smartphones – interlinked, banks can make progress in countries throughout the world.
Summarising the panels and presentations from the day, Haasis said: "Whether its bricks, clicks or flicks, the 'New Normal' means banks must learn and change – and do this fast."
Under the theme "Gearing up for Digitisation: Adapting Retail Banking to the Digital Age", the event showcases some of WSBI-ESBG's digital-savvy members who come from more than 10 countries in Asia, Europe, and the Americas. It also provides a forum for fintechs and mature, tech-driven firms like IBM, to exchange ideas with the traditional banking sector. More than 30 speakers and presenters took part, looking to find ways to best harness digitalisation and technology to provide better financial services to people. The conference weaves in a public policy thread, with Commissioner Oettinger and other policymakers joining member banks, technology experts and other stakeholders to address the need for innovation-friendly public policy.
On public policy and digital banking, Haasis concluded: "The future of will be shaped by many forces, including political. Banks already face a landscape where rules have changed and have grown. The post-crisis period has not only been a change for banks, but for policymakers and regulators too. Policymakers need to recognize the valuable role of savings and retail banks in local communities. They should know their role as a financial catalyst for small and medium-sized companies. Our message to policymakers on how best to support the switch to a digital banking future is clear."
WSBI represents the interests of 6,000 savings and retail banks globally, with total assets of $14tn and serving one billion customers in nearly 80 countries (as of 2014). WSBI focuses on international regulatory issues that affect the savings and retail banking industry. It supports the aims of the G20 in achieving sustainable, inclusive, and balanced growth, and job creation, whether in industrialised or less developed countries. WSBI favours an inclusive form of globalization that is just and fair, supporting international efforts to advance financial access and financial usage for everyone.
ESBG brings together nearly 1000 savings and retail banks in 20 European countries that believe in a common identity for European policies. ESBG members represent one of the largest European retail banking networks, comprising one-third of the retail banking market in Europe, with 190 million customers, more than 60,000 outlets, total assets of €7.1 trillion, non-bank deposits of €3.5 trillion, and non-bank loans of €3.7 trillion. ESBG members come together to agree on and promote common positions on relevant regulatory or supervisory matters.