Taking a spin in my driverless hovercraft through the changing world of financial services to take a peek into the future.  Hop in…

Bitcoin Gains Currency

This story caught my attention recently.  Fidelity Investments CEO Abagail Johnson announced that Fidelity would be enabling clients to see their bitcoin and other virtual currency assets on the company’s website.  On one hand, this could be seen as Fidelity providing a service that some of their customers would value. Fidelity, after all, appears to spend a bit more time thinking about digital currencies; their employees can use bitcoin to pay for their lunches in the company cafeteria. 

On the other hand, this shows the path that new ideas tend to travel. The new technology is initially viewed with skepticism and relegated to distant corners of an established ecosystem. As it evolves, the big players start “playing” with it (internal POCs, integrating it into the company cafeteria, etc), and then provide links to their mass-market users.

Of course, we’re used to new technologies. New currencies is likely a completely different matter. But this announcement from Fidelity is worthy of notice.

Some Like It “Bot”

The rise of bots in banking is well documented. They enable financial institutions to deliver good information to consumers’ common questions. Bots utilize natural language recognition so users don’t have to download an app or learn an app’s interface to get to their answer.  And while this is interesting in financial services, it is also interesting to see how bots are becoming more commonplace in non-financial functions, such as internet searches.

This story from VentureBeat outlines how Microsoft is now providing Facebook Messenger, Slack, Skype, Kik, and Telegram bots in certain search results. Somewhat like the Fidelity example above, when bots are discoverable via simple search results, then the average consumer views them as trustworthy and mainstream. This, in turn, creates a more accepting user community for financial service bots.

If you look at how the results are displayed, they are reminiscent of app store results. There likely will be more bot platforms developing, leading to more bot usage.

Financial institutions are wise to jump on board as aggressively as they have. According to a study by Personetics of financial institutions’ view of bots, “When asked what percentage of conversations would be handled by chatbots over the next 3-5 years, 34% of the organizations surveyed believe that over 50% of conversations would be handled by bots”

So after our hovercraft lands, take a moment and play with this yourself. Go to Bing.com and enter “travel bots” or “news bots” or many other bot variations. You’ll get a glimpse into the future.

But before you do that, we have one more stop to make…

Are You Really You?

Hey – not everything about the future is about fanciful doo-dads that blink and making chirping sounds like R2D2. Anyone in banking knows that it is a business based upon risk evaluations and real money. In no area do risk decisions impact a bank’s results like money transfers.

Governments, of course, have an interest in money movement, and thus have created AML (anti-money laundering) regulations.  In an era of digital currencies and bots, it is harder for licensed money transfer agents (including, but not limited to, banks) to determine if users are who they say they are. And governments are holding banks accountable.  According to a recent PYMNTS whitepaper, between 2009 and 2015, “…the US government fined banks a total of $5.2B”.

Yet, according to the same research, it is also interesting to note that 79% of the world’s population has official government documentation. This might be helpful in combating small, in-person fraud, but how might financial providers leverage those IDs in digital channels to make smart risk decisions?

This is where sophisticated computer-vision technologies like those provided by Mitek can make an impact. By leveraging the mobile device, a financial provider can gain powerful insights into the likelihood that an identity document is authentic, and even match the picture on that authentic document to a selfie taken real-time.  If, as the white paper states, 2%-4% of the global GDP is at risk of being laundered, then the stakes are high.

Thanks for riding along with me! I’m not sure the ride for financial institutions will always be as smooth as my hovercraft was, but there are a range of exciting tools that will help smooth out the bumps.

Good luck!