Banks must reshape to survive compliance and technology crunches
KPMG and EY highlight Australia’s big four banks must balance ongoing compliance costs with continued spending in technology or face being left behind when it comes to innovation. In their post FY18 analysis of Australian bank results, KPMG and EY point to several compliance and technology headwinds facing the sector and suggest cost discipline will be a major focus. It means more restructures and simplifications. KPMG partner, banking strategy, Hessel Verbeek said not only have various compliance and remediation costs translated into higher cost-to-income ratios, “the majors’ investment spend in risk and compliance projects is also up strongly and in most cases investments on growth initiatives has decreased in a […]
Regulation alone won’t solve financial advice woes
By George Lucas, chief executive of Raiz More regulation will be the most likely result after the Hayne royal commission hands down its final report. But is this really the answer? When then financial services royal commission hands down its final report by 1 February 2019, it’s odds-on it will call for more regulation. And the government of the day will duly oblige, rightly fearing the political fallout if it fails to implement the report’s recommendations in the wake of the malevolent behaviour being unveiled. The legislation will pass the Parliament, giving the regulators more power to keep the top end of town in line. And the regulators, whose reputations […]
The opportunity of open banking
Open banking is set to reshape the way customers access their data and banks and other financial institutions are now getting ready to start implementing the system from next year. Australia’s four major banks must have implemented an open banking standard by 1 July 2019 and other banks will need to follow by the same time in 2020. One company, which has been working with open banking before it even began, said the regime will make things much easier. MoneyTree launched in Tokyo, Japan, six years ago based on the idea customers should have better access to their data. It started with a personal finance app which categorised users’ spending […]
How Westpac is investing in fintechs and spending $1 billion on digital transformation
Westpac’s annual results show how far the bank has gone to transform itself into a digital showcase and how it has been heavily investing in the rise of disrupting fintechs. Out of a total investment of $1.4 billion, the bank spent more than $800 million in system upgrades, digital transformation, and innovation. CEO Brian Hartzer says the focus has been on delivering technology platforms, while simplifying and automating processes to make banking easier. “We have already migrated 100 applications onto our cloud infrastructure platforms which are now largely complete,” he says. “Additionally we have over 120 APIs in production and another 180 in development.” Among digital initiatives are Siri for […]
Neobanks are about to explode onto the Australian market
A number of restricted banking licences are expected to be issued to aspiring neobank startups by Australian authorities in the next few months. A raft of fintech players, including Xinja and Up, have already completed detailed applications to the prudential regulator APRA. The first licence went to Volt in May this year, creating another bank in Australia for the first time in 28 years. Since then, key players have been working to complete the regulatory hurdles to be able to call themselves a bank. APRA hasn’t a timetable for an announcement of new restricted authorised deposit-taking institution (RADI) licences but several startups expect an announcement shortly. The new restricted licence […]
Finastra launches Open Banking Readiness Index in Asia Pacific
Finastra today launched its Open Banking Readiness Index, providing for the first time a framework for banks in the Asia-Pacific region to assess their capabilities and benchmark readiness against peers in the race towards Open Banking. Unveiled during Hong Kong Fintech Week, the research reveals that 84% of the top 146 banks in Asia Pacific are considering collaborating with external partners to enhance their Open Banking capabilities between 2018 and 2020. Developed in partnership with IDC Financial Insights, the Finastra Open Banking Readiness Index measures banks across five dimensions – Adoption of APIs, Fintech/Third-Party Ecosystem, State of Data-based Transformation, Data Monetization, and State of Innovation. It is based on interviews […]
Neobank pioneer Brett King joins Xinja
Xinja, which is building a 100% independent digital bank, or ‘neobank’ for mobile, is adding significant global expertise to its organisation with the announcement that Brett King will act as a permanent advisor to the Board, and help guide Xinja’s strategic direction. Brett King founded neobank Moven in 2011, which launched the world’s first mobile, downloadable bank account. He is widely considered the most influential expert on retail banking innovation globally. Mr King was an advisor to the Obama White House, the US Federal Reserve and the Office of the Comptroller of the Currency on the future of banking in the United States. Mr King said: “I have been working […]
CBA ramps up blockchain
Commonwealth Bank is close to completing more blockchain projects, after it delivered the world’s first blockchain bond with World Bank in August. Speaking at SIBOS, Sophie Gilder who is CBA’s head of experimentation and commercialisation for blockchain, embodied AI and emerging technology said CBA has a portfolio of blockchain projects. Some of these are at very early stages where the bank is trying to determine if they are worthwhile to take forward or not. Others are at a pilot stage where the bank has been through successful proof of concept, has demonstrated the feasibility of the technology being applied to a particular problem and is taking the project to the […]
