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AfO: Expanding on Paul Steenkamp, Standard Bank’s Head of Innovation’s point about banks’ failure to think outside the box, with a particular focus on fintech firms, how do you believe companies can escape the trap of becoming internally focused? GO: There is no clear-cut recipe, with a lot of innovation happening across the board, including our own customers. Innovation and experimentation need to be part of your DNA. Create time to experiment and learn. So much has been written about Google’s ‘20 percent time’, which encourages employees to spend part of their day working on new concepts that could benefit the company down the line; others have innovation programmes with trips overseas awarded to the best new ideas. Find your own way towards fostering
stimulated by new technology and business models; a self-selected group that does not consider in-person interactions important at all. They know how to get the job done fast on their own. That, enviably, helps fintechs keep costs low while spurring them even further creatively. Traditional companies need to adjust by choosing technologies that will enable them to compete effectively with the new players, and get past the regulatory burden to the truly transformative stuff. There are indubitably many advantages to being the bright new kid on the block. Remember though, that smaller firms often launch great-looking products with no real substance.
“Banks and fintechs must take a global view on compliance. There are distinct regulatory trends out there and, if they are not yet in evidence in your region, they will probably be soon”
experimentation in your organisation and ensure that you can learn quickly and fail fast. Look at trends in other industries and see whether they could be of value in yours. I must say, however, that I have a bit of a problem with organisations creating a dedicated digital team, as everything is digital now. If you hive it off as a special department, you may flounder. AfO: Looking to the future, what effect would you say regulatory bodies will have on fintech firms as they begin to adapt and grow? GO: Everyone will need to comply, which will increase the barrier to entry into certain service areas. This sounds so negative, but we’ve seen too many examples of breaches damaging trust and slowing adoption in certain markets. Failures like these can have a long-term impact. Smart fintech companies know this and have or will put the fundamentals in place, building reliable solutions that inspire confidence among ever larger numbers of people. Banks and fintechs must take a global view on compliance. There are distinct regulatory trends out there and, if they are not yet in evidence in your region, they will probably be soon. Don’t wait and end up on the back foot. Think ahead. Don’t opt for incremental change. If you are thinking about replacing technology and redesigning products to fulfil today’s regulatory obligations, try to prepare yourself for what comes tomorrow. Pick solutions and partners that can meet more than the immediate need. While it may take a bit more effort in the short-term, your reward down the line will be added capacity to develop more compelling and creative products and services. You don’t work for the regulators; you’re in the business of serving your customers!
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