Bill & Melinda Gates' Next Target: Banking
CNN Money comments on the Gates' decision to make banking one of four exciting breakthroughs in their annual letter.
"At first glance, mobile banking is a surprising choice for the Gates Foundation to throw its incredible heft behind. In the past, the philanthropy, which controls over $42 billion in assets, has focused challenges like access to condoms and turning human waste into drinking water. But now the power couple is thinking about the 2.5 billion adults the World Bank estimates are without a bank account."
You can read the specifics straight from the Gates' annual letter, which is beautiful, logical, and ethical. It's worth reading in full.
Machine Learning + Big Data = Predictive Analytics
Peter Levine of Andreessen Horowitz talks about the need for data analytics software to switch from merely collecting data to offering suggestions about how to use data.
"Machine learning is to big data as human learning is to life experience: We interpolate and extrapolate from past experiences to deal with unfamiliar situations. Machine learning with big data will duplicate this behavior, at massive scales. Where business intelligence before was about past aggregates (“How many red shoes have we sold in Kentucky?”), it will now demand predictive insights (“How many red shoes will we sell in Kentucky?”)."
The shift to predictive analytics has enormous implications for the banking industry. Financial institutions equipped with these tools will leave competitors who rely on gut impulses in the dust.
Why Do People Switch Banks?
The Financial Brand summarizes a survey by the Sells Agency that finds that people overwhelmingly switch because they move to a new location. Based on this data, here's an idea financial institutions might consider: Advertise most heavily in areas near new housing developments, with a message that establishes yourself as the area's banking institution of choice or as the area's leader in fintech. You have a short window of time to win these account holders. Take advantage of it. Otherwise they'
4 Essential Strategies for Branch Banking Survival
Jim Marous of The Financial Brand reports on four keys to retail banking branch survival, as outlined by Connecticut-based branch design-build firm Solidus:
- Branch location and design that reflects digital channel integration
- Expansion of branch personnel duties
- Utilization of multi-sensory marketing communications
- Focus on overarching efficiency
Each of these suggestions centers on reimagining the branch for the digital age — a must for financial institutions.
Solidus presented their research in the form of a comic book, which is also worth checking out.
Mobile Payments Will Be Much Bigger, Much Faster Than People Think
Business Insider's John Heggestuen shows how quickly mobile payments is heating up. He says, "mobile payments only need to take off at a handful of large businesses in order to drive massive growth in payment volume."
Banks' Five Big Tech Priorities for 2015
Cathy Bessant, the global technology & operations executive at Bank of America, outlines her five main priorities as she gears up for Davos. This paragraph about simplicity is especially fantastic:
"Innovation in the service of simplicity. The world and the technology that runs it grow more complex every day. Our challenge is to deliver solutions that make the complex simple. Innovation is critically important, as long as we keep in mind that our goal is not to produce shiny new toys but to make people's lives easier."
Making the complex simple is perhaps the underlying motivation of all fintech endeavors, from payments to financial management.