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To be honest, after many years working in financial technology inside banks, and then several years outside banks in Fintech, I think the scenario described here is something that many of us saw as inevitable or obvious a long time ago.

The number of Fintechs that can truly disrupt on their own, without any bank type collaboration is extremely limited due to the need to scale rapidly and effectively without simply burning easy money.

Even high profile stalwarts of the "Bank 2.0; 3.0;..." world such as Moven appear to have only really started getting true traction and volume when they switched to a bank collaboration model instead of the pure bank disruption and competition model.

Interesting idea and reminds me very much of the concept / model of USAA bank in the US.

USAA started out as an insurer (hence the name) before becoming a full fledged bank.

USAA bank is an extremely well run and innovative bank in terms of delivery channels with a clear focus on servicing military personnel needs wherever they may be at any time.

Their customer service has a reputation for excellence, and working with military personnel, their levels of fraud, delinquency, etc. appear to be very low. Will that hold true for the UK also?

I'd be very interested to know if "Services Family" is modeled on, or inspired by, the USAA experience.

Sadly - trying to have a reasonable and intelligent conversation on this question is a little bit like "mission impossible" .,. To the point I'm not sure it's even worth trying to have a balanced and sensible discussion with anyone who has not live and worked overseas... Would love to know how many opinions here are actually based on real work experience overseas - as opposed to bigoted opinions and ideas

@Ketharaman... :-) It's really just a question of perceived flexibility and economics. The fact that you / we can spin-up additional resources very quickly as and when needed, and take the same down again when the workload drops off... all without the traditional Capex.

But - and I think we agree - there's a gap in people's perceptions about who really needs to take responsibility for ensuring business continuity in this virtual world.

Today, in my mind, it is still the customer, and has to be. Tomorrow, maybe a cloud vendor comes up with a solution that allows them to handle the same without creating any data / access security concerns. If they do, and Azure is maybe closer than AWS to this with their PAAS offerings... then they will bring huge value to the table.

@Ketharaman... I agree, but I believe a big mistake a lot of people make is that when you port Financial Services to "the cloud", the route being followed is highly secure, locked-down, environments that are IAAS... where the customer - not the cloud vendor - still has to define and manage their redundancy needs. There are significant economic benefits to this still. But I'm not sure it's fair to lay the reponsibility for Business Continuity wholely on the doorstep of the cloud vendor.

@Gerhard... I fully agree with you that data needs to be already available at the alternate site. I should have probably been more clear and explained I referred to real-time / on-line geo-replication. In my ignorance I don't know if that is supported by AWS, however we use it in our Azure services... and we're not a bank processing critical client transactions and services...! The cost overhead is actually very low as most of the infrastructure in the secondary site does not need to be spun-up until actually needed.

So... "a storm caused a major outage at a cloud computing service"?? Surely these banks did not have everything in a single data processing center. Or did they? I can't believe they haven't heard of, or implemented, geo-replication for a critical service like this. If they didn't have replication implemented, blaming the cloud service vendor seems short-sighted.

And - just out of curiosity - what will happen to all of the Fintechs who currently enjoy setting up in the UK given the (good) flexibility and easier regulations offered by the FCA, and the fact that this gives them a passport to operate in Europe?

That passport will disappear... and being registered with the FCA will no longer be the attraction it was.

Fintechs will look for somewhere else to set up.

Sadly for someone who is a supposed "thought leader" in the world of Fintech, the article's content is very lacking in any serious analysis.

@Vishal - have to agree with you.

Website visits? Pageviews? Logon to internet banking? And POS store transactions?

I don't see any of those metrics being an indicator of a digital bank strategy, and instead seem to be simple BAU that has been around for many,many years.

Bill payment, mobile app log-ins, and transfer statistics - maybe. But those are hardly innovative services and features.

I am interested by the stated idea of:

"...making sure that people can access high quality, affordable, tailored advice and guidance to help them make informed financial decisions..."

This seems all well and good, but if the advisor cannot back up that advice with the appropriate product offering and characteristics that actually respond to that customer's personal needs, then the advice has little value.

We've seen for years that tailored advice and appropriate solutions is generally restricted to a very reduced audience, be it large corporates or private banking customers.

To resolve this, FIs need to put in place the capability to democratize these product offerings with an ability to allow general consumers dynamic personalization of off the shelf offerings. This is particularly true in the savings and investment space where current bank technology is simply not designed to be able to handle this need.

Handling this need requires at least 2 key components:

Front line sales and advice tools that allow both branch staff and consumers to understand what different product offerings bring to the table, in a way that is fully transparent with a clear description and presentation of any risks, and other product attributes. We need to ensure that advice and sales are fully compliant and presented in an intuitive, consistent and clear manner. At the end of the day we want and need satisfied customers and good sales.

A new core savings and deposit capability that allows us to provide these product offerings with dynamic attribute adjustment and automated repricing - but without creating any additional operational overhead, and with fully automnated downstream processing and treasury management.