Debbie Bianucci
Debbie Bianucci Aug 2, 2017

The innovation realization: It’s more than just fintech

So much of what happens in our industry today boils down to this popular conclusion: Innovation equals fintech. To be sure, the buzz that surrounds artificial intelligence, chatbots and machine learning is understandable. And at first blush, the dollar figures surrounding fintech seem to support its primacy as innovation’s driving force.

Forbes, for example, reports that in 2016, global fintech venture investment soared by 11 percent to $17.4 billion. The deals included one for the record books: China's Ant Financial landed $4.3 billion in venture capital, the largest such round in fintech history. Clearly, fintech now captures the imaginations and investments of those who look to back the next big thing.

Yet as truths go, there is an even bigger thing. Innovation is more than the latest technology—much more. That is: We see ongoing innovation in a host of non-tech areas that also impact how financial institutions build business, serve their customers and reach out to the unbanked and underbanked.  

The likes of big data and cloud computing cannot begin to fill in a greater innovation picture for financial services that encompasses a host of rich, non-tech elements. These include (but are not limited to):

  • Process innovation
  • Channel innovation
  • Marketing
  • Breakthrough collaboration, and
  • Societal/community impact

Simply put, innovation creates ways of improving things so that they work better and smarter, and address unmet needs. BAI has always had a focus on forward thinking in the industry, and for the past seven years we have recognized that thinking through our Global Innovation Awards. We have seen definite changes over time, including the strategic importance of innovation itself. 

Consider that every part of the business depends on finding, hiring and retaining the very best talent to spur innovation. That’s reflected in a new awards category, human capital. We can see through our Talent Benchmarking that the most successful financial service companies think progressively about talent. Organizational structures may differ, as well as the innovation initiatives. But talent remains the key that unlocks true progress.  

Meanwhile, in the midst of so much fintech-led disruption, there’s also been lots of talk about the customer experience. The issue is important, and disruption in any industry causes stress. It moves the needle and changes customer preferences, as we’ve seen with the mass migration to mobile services.  Bank of America’s most recent Trends in Consumer Mobility Report found that 36 percent of adults currently use person-to-person payments, with millennials leading the charge at nearly double that rate (62 percent). What’s more, 45 percent of consumers say they plan to start using the service within the next year.

Yet there’s a fine line between recognizing a single game changer and losing sight of all else. Study after study also reveals that consumers still want human contact with their banks, and that includes those tech-savvy millennials.  

Meanwhile, some truly revolutionary developments are taking place within societal and community impact. While high-tech is sometimes involved, this impact is not dependent on technology. Rather, the innovative thrust centers on creative new concepts that fall into that category—and that are exciting as well as good for business and attracting new customers.

One Global Innovation Awards winner, Turk Ekonomi Bankasi (TEB), headquartered in Istanbul, emerged as an example for banks here and abroad. Its Women Banking program, established in 2015, provides financing, information and advice to women-led, small- and medium-sized businesses. It leverages powerful resources through a partnership with WEConnect International, a Washington D.C.-based global network that finds new markets exclusively for women suppliers.

Now let’s look at another hot fintech topic, artificial intelligence. To be sure, AI will enormously impact the way we all live and how financial services will be delivered. It’s already gaining steam. But it’s just one of many aspects built around how to meet your customers’ needs, and it’s not the only way.

After thousands of submissions to the Global Innovation Awards over the years, we have identified three defining factors that form the foundation of successful innovation:

  • A culture of innovation. Here, innovation reflects the company mission, is opportunistic, is smart about risks, and manages through failures.
  • Importance of talent. This means finding people who think differently and possess great intellectual curiosity, who are willing to do things in new ways, and who build networks to collaborate. They are proactive and persevere, which adds up to stamina.
  • Excellence in execution. Great ideas that sit on the table remain mere ideas and fail to foster meaningful change. Execution equals the ability to deliver the innovation and bring it home—along with the courage to make it happen.

Waiting on the newest tech advancement is in fact nothing new. And to be certain, financial services leaders need to stay on top of the latest in tech, understand it and make it fit in with their business strategies.

But a big part of understanding is not overreacting. Whatever form technology takes, there will always be something new to pursue.

Maximum progress and impact can’t be accomplished through one gadget, one short-term goal or one business initiative. When it truly shines, innovation aligns with mission. It becomes part of a company’s DNA. It takes on life and builds strength to outlast the toughest of times.

Perhaps this marks where we can improve most. It’s easiest to invest in innovation when performance is strong. But we must keep it from dropping off during down cycles if we are to retain its positive power.

True innovation means a commitment to moving the ball forward, day after day, year after year. Only in this way can consumers and collaborators, communities and countries, and our financial services organizations all win at the same time—and keep winning.

The finalists for the the 2017 BAI Global Innovation Awards were recently announced.


Debbie Bianucci is the president and CEO of BAI. Tune in Monday to hear her discuss the importance and evolving facets of innovation on the BAI Banking Strategies podcast.

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