Banking Apps: Fad or Future?
I am quite comfortable with being a technophobe. I don't have anything against technology, but in many ways am still not sold that many recent inventions actually improve our lives. In more than a one respect, I think the myriad of techno-options available for daily exercise only add to unnecessary sensory overload.
That having been said, I have no interest in pushing a stone doughnut up a hill while my neighbors cruise around in carriages. Even though I don't own an iPhone/iPad and have no interest in accessing iPee, iPoop or iPray applications, I make no attempts to diminish their culturally contextual significance. The more time goes by, the more these techno trinkets will be part of our lives, not all together different from the hand designed doo-dats and knick-knacks which adorned the bazaars of ancient cultures.
The interesting twist will be when these apps begin to take on a more commercialized, career oriented assault...err...role. An interesting bit of news on the subject was recently published in Bloomberg, to surprisingly little financial industry fanfare.
It is looking more and more like bulge brackets street-wide will be moving into the iPhone application arena as a means of doing business. After all, with such a huge market burgeoning, banks would be stupid not to add more cash cows for the milking. Right??
Bank of America and Wells Fargo have already gotten into the act, testing mobile-payment systems using smartphones in a small number of cities across the country.
BAC's online brokerage, Merrill Edge is kicking the tires on a face-to-face teleconferencing app which would put clients and advisers into a virtual room together.
How do you guys feel about the precedent this may set. Can you imagine how many thousands of monkeys would become expandable as a result? Eliminating the face-to-face aspect of banking would be the final step in completely dehumanizing and detaching the industry from its customers. I often hear industry people claim that Front Office banking activities can never be outsourced. Well...what if they are not outsourced? What if they are mechanized?
Think about how much money banks would save on operations and infrastructure if a Wall Street office building could be replaced by the a monthly web hosting tab.
Have I gone completely off the deep end in thinking this a future possibility? Are you guys taking this seemingly small, but possibly monumental event, seriously? Is banking impervious to technology's effects?
Netflix did it to Blockbuster...Amazon did it Barnes and Noble...and is doing it to Best Buy.
Why can't iPhone banking apps do it to Wall Street?
Just because they are speaking through video conferencing doesnt mean theres not face to face?
The research apps that some banks have for the iphone/ipad are great, I use them a lot and they save me a lot of printing.
It is possible that they may outsource, but I don't see it replacing face to face interaction completely. I compare it to bartending: better technology may help cut down on the number of staff, but will not replace the fact that people want to go to a social environment. Scary thought though, so I'm going to make money while I can.....
I cast my vote with FAD......for now
In my opinion, why have an employee board a jet when I can fed-ex an ipad and walk the client through it via video conferencing? The actually closing(handshake w/ john hancock) will still have to be face-face, sale techniques will never die. New bankers may get crushed like floor brokers in commodity pits if they can't close now.
My vote is the future
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Midas depends really on what you part of banking you are talking about. For retail, certainly front offices can and will easily be replaced and they will be first to go. I personally like Chase with their iphone app which even reads checks. The bloomberg article was interesting especially the part where teleconferencing can be done for in the long term for advisory and will definately bring about a major push, squeeze the players & limit number of staff.
Midas I personally say this is where non traditional, both techvilles and others with non tech entrepreneurs(given how many tech startups where done by folks with no background) will bring about major dent to how finance is handled. Look at this way, with more apps, research to a large extent will be eliminated as both data and prospective trending can easily be modelled using the available rich data.... The future is tech... or as Peter Thiel put it....."To Infinity & Beyond" Cheers all.
Well, places like SecondMarket are starting to make inroads aren't they?
Realtors have been able to protect their market pretty well, but you're seeing it there too...the MLS system is the only barrier to listing...which is total BS...
The thing is, this can never really replace the overwhelming majority of what bankers at all levels do. Even IAs shouldnt feel any squeze from this. Sure it will stream line processses and cut the need for last century jobs such as "check clearers" but those have been going by the way side due to internet banking. The thing about these apps is that they are too one dimensional. Its just like in trading, computers have taken over alot of the menial tasks of order matching and what not but they havent replaced the gut of the trader. I dont see the apps being the begining of the end of the banker but the rise and acceptance of AI. With a program or app it runs in a set paramater, this industry is built on things that happen out side of the box. There is no way I would trust an iphone app in processing a loan app let alone handle multi billion dollar M&A deals.
the day we actually have a paperless office would be the day i believe that human interaction and something tangible will be replaced.
it's just human nature
i think in terms of saving in operations/infrastructure, cloud computing is a huge advancement that could be detrimental to commercial real estate, but sometime in the distant future. when you no longer need physical infrastructure or your own data centers along with back office roles being outsourced due to advanced IT, you could see buildings becoming a cost that companies can cut. everything being in the cloud will make operations so much smoother. and cloud "real estate" would essentially replace commercial real estate. that'd be one crazy financial security, something created for value of virtual space instead of CMBS.
but bankers and anything front office with client interfacing is core to the business and can't be replaced. maybe you could see more wall street jobs becoming telecommuting jobs, and you wouldn't necessarily need to be at nyc just to have the best IB gigs and exposure.
Not going into whether or not this technological revolution will even work, banks win new business because they form "close" interpersonal relationships with these CEOs, and Fund managers etc. No technology is ever going to replace that.
Thank god for developing countries that don't have the infrastructure to support such large schlobs of data :D
I am actually surprised this topic has only fifteen responses. A worrying trend for those in finance. Be worried folks, be extremely worried.
stop fearmongering
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