For this post, I tuned in to the Code and Cocktails episode by the name Exploring Fintech Innovations. Amancio Bouza, API thought leader and chief product officer at Contovista AG, represents an area in tech known as fintech, or financial technology. This field describes how technology can improve and optimize delivery and use of financial services. The episode delves into the intricacies of modern banking, and describes how woefully behind banking is in the modern era. Some institutions are so large they disregard the need for things like API implementation entirely, thinking that they have a few years before it becomes essential. To combat this, consultants like Bouza educate banks on the future necessity of the technology.
For example, upgrading certain models of data analysis could provide statistics on customer preferences and expectations. Thus, this information coupled with machine learning has the potential to tailor specific financial advice to a user at an individual level. This could theoretically be massively beneficial to a bank’s constituents, by educating them on specific pitfalls and nuances of their financial situation, hopefully pushing them to accrue more wealth once they understand the data. Once the understanding of some patterns and validity of different models are smoothed out with machine learning, it also greatly helps with risk management for both the individual and the bank itself.
In addition, Bouza notes that in the next decade or so society will shift to a more decentralized payment model, with debit and credit cards being phased out for account-based financial transfers. This is an infrastructure many larger banks need to adapt to, as Bouza notes the autonomy granted by such a shift will be an inevitable draw for modern day consumers. He references a “lack of urgency” in these large institutions, whereas startups who are on the razor’s edge of success or failure will scramble to be ahead of the curve of general tech implementation to keep up with the market. In the classic capitalistic train of thought, they consider themselves too big to fail.
I think it’s also important to mention that people like Bouza are far from wanting to totally restructure the system. He’s working to educate existing entities and give them the tools to prosper in the coming future – tools that will benefit both the institution and the consumers. By incorporating even a small portion of Bouza’s suggestions, people can take advantage of the autonomy given to them to invest in hyper personalized interests. Autonomous finances have the ability to make each consumer the most wealthy and frugal that they have the potential to be, which is a net win for everyone involved.
Dummies that Code 