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Can mid-sized banks thrive in the digital world, and are they FinTech’s new best friend?
Journal of Digital Banking,
3
(3),
198-205
(2019)
Abstract
The banking industry is changing, and the drivers of its change are very strong: new regulations aimed at eliminating borders and forcing banks to be more open, profound changes in customer behaviour and expectations and also computing technology, in general, have suffered astronomical upgrades. These elements have created a perfect storm for the banking industry, which will, as a result, be remodelled and transformed. Banks must adapt, and this is understood by all of them, but probably banks ignore how much they must change if they want to feature in the future of banking. This paper aims to identify the major transformational pillars of the new era of banking, explaining that mid- and small-sized banks have a chance to be part of that future. A view of the likely changes ahead reveals that change will be so profound that larger banks may take longer to adapt. Also, and probably more importantly, ‘digital’ helps to create a level playing field in which smaller banks even play with an advantage. Change, however, must be taken seriously and courageously as otherwise those banks that do not adapt will inevitably fade away and disappear.
Keywords: banking; retail banking; digital banking; digitalisation; digitisation; open banking; digital transformation; PSD2
The full article is available to subscribers to the journal.
Author's Biography
Carlos Sanchez is CEO and co-founder of ipagoo, a pan-European digital provider of cash management and payment services. Ipagoo represents a new model for banking, where everyday services, such as current accounts and payments, are separated from balance sheet-dependent credit and lending activities to provide a real alternative to traditional banks in Europe and beyond. Ipagoo intends to naturally support its customers with non-core activities through a variety of distribution partnerships for savings, credit, investments and other financial services. Carlos was a member of both the Payment Systems Regulator (‘PSR’) Panel and the PSR Strategic Forum, which are charged with defining the UK’s current and future strategy for payments. He has also been Chair of the working group within the Forum devoted to specify the New Payments Architecture of the UK, to replace Faster Payments, BACS and CC&C, among others. He was previously an executive director at Goldman Sachs in London, acting as financial adviser for the European corporate market in investments. Prior to this, he had created, and was CEO of RBC Dexia in Italy and Dexia Investor Services Bank France, both part of the Dexia Group. He was also Country Head of Fund Services and Head of Operations of Dexia Private Bank France. He holds an MBA from IMD in Lausanne, Switzerland, as well as an MSc in Telematics and a degree in Telecommunications Engineering from Vigo University, in Spain.
