The fourth industrial revolution. Banks must change. Debate: Technological revolution in financeParticipants:
Jowita Michalska, President of the Digital Univesity, Singularity University Chapter - moderator
Sylvain Bouyon, Head of Retail Finance & Fintech Programme, CEPS
Aleksander Poniewierski, Partner, Global IoT Leader, EY
Shanker Ramamurthy, General Manager, Strategy & Market Development, IBM
Clive Ryan, Regional Director DACH, CEE and Benelux, Facebook
John Velissarios, Managing Director, Global Blockchain Technology Lead, Accenture “Competitors won’t stop at nothing. They will go for what’s most profitable, improve product quality and keep penetrating the market”- such warning was delivered to representatives of the banking sector in regard of the technological revolution which we have been witnessing.
The participants of the debate entitled “Technological revolution in finance” attempted to answer questions regarding characteristics of the so-called fourth industrial revolution and its impact on the future of the financial sector. Do traditional banks have reasons to be afraid?
The panelists recalled that the first revolution was all about steam, the second - about electricity, the third - about computers, and regarding the current revolution, numerous factors are at play, involving the use of artificial intelligence, the Internet of things and advanced data analytics.
Aleksander Poniewierski pointed out that the young generation is no longer motivated to act by the very same factors which served as the trigger for older generations. According to him, among other things entrepreneurs should realize that young people no longer buy things just to have them, but rather to use them. That is a crucial difference which changes business models.
“For the first time in history, man can gain both expertise and experience,” stressed Aleksander Poniewierski and recalled the present technological revolution’s concept of a “digital twin”.
The participants of the debate also paid attention to the situation and trends on the payments market. As Shanker Ramamurthy stressed, although banks are still regarded as places where clients’ funds can be put to work, they have been less and less seen as the operators of payment systems. Technological companies seem to be ferociously competing for that market segment.
“Competitors won’t stop at nothing. They will go for what’s most profitable, improve product quality and keep penetrating the market,” stressed he.
Clive Ryan stated that the banks must remember about opportunities related to mobility. He recalled that the number of users of mobile devices and, consequently, m-banking has been growing rapidly and banks must keep up, too, and develop in that area.
Other topics which were of crucial importance to the technological revolution in finances included the future of crypto-currencies and issues related to cybersecurity.
Although attracting mainly so far the attention of consumers, crypto-currencies stand a chance of becoming a legal tender issued by central banks. As John Velissarios emphasized: “That is the reason why academic circles have to spend a lot of time researching that market. Education is vital here. That’s a huge investment of time but if we want to keep developing, we must have resources and be prepared for what is yet to come,” said he.
Describing challenges faced by cybersecurity experts, Sylvain Bouyon stated that it is impossible to eliminate cyberattacks. However, it is important for the financial institutions to be able to do their business in the face of such attack. In his opinion, state institutions and the private sector alike should bet on broad co-operation in the area of, for example, data exchange regarding any and all incidents to be able to fight cybercrime more efficiently.