The idea of a single customer view (SCV) is something that retail banks have been kicking around for a while, and on which the FSA in January of this year proposed banks should invest around £1bn (Computer
Weekly, 08 Jan 09). The FSA was worrying about the ability of individual investors to be able to get their hands on their money in the event of another banking crash. However there are lots of other reasons why retail banks should want to invest in their
ability to see all the aspects of one customer’s business. In particular we’re all becoming more fickle: we change our gas and electricity providers, switch our credit cards and change mobile phone networks regularly. Surely the next step is that we start
to switch our bank accounts, wealth managers, stockbrokers and independent financial advisors more often?
Retail banks have relied for generations on client inertia; I still bank with the same bank as my parents (although I have moved branch), but I’m considering changing. If my bank truly had a single customer view of my business and used it properly it may
be able to predict when, and why, I might be considering moving and try to offer me some additional services to encourage me not to.
But it occurs to me that one area where clients are already highly mobile, even trade by trade, is investment banking. Surely SCV must come to the investment banks, and soon? Their clients often trade through a multi-dealer portal and their prices are anonymous.
At the moment, as a result of the credit crunch there’s a relatively low volume of trading and many banks still in the market seem to be doing OK. But as the economy picks up competition will grow and banks will need to increase volumes to maintain and increase
The forward-thinking investment banks are currently working out how they can maximise the deal flow from their clients; investing in single-dealer platforms where they can offer client-specific pre-trade data, news and analysis along with client-specific
pricing seems a good first step. It is likely that the next step will be to try and offer multiple asset classes through these portals, and then to start to build an SCV for institutional clients in the same way that retail banks are trying to do it for their
There are lots of issues here but IMHO it’s got to come. And it’ll provide lots of business opportunities for a wide range of technology suppliers whose products are impacted by it, and for the consultancy and services companies that provide the infrastructure.
As ever in business, the only constant is change.