In late September, we were at SIBOS 2016, the annual trade show hosted by SWIFT. It’s a major showcase for innovative financial technology (“Fintech”), featuring the latest news and analysis about banking and electronic payments. Over 8,500 people attended this year, with Eurasian, Middle Eastern, African, and Chinese banks showing a stronger presence than in the past.
The show was in Geneva, and we were struck by the contrast between the timeless beauty of the Alpine setting (snow-covered Mont Blanc looming over the skyline, Lac Leman at the foot of our hotel, and our daily commute passing vineyards) and the dynamic, even futuristic, requirements of the financial industry in the 21st century discussed at the conference.
SIBOS has been morphing as SWIFT seeks out new directions. It offers a showcase for Fintech through its Innotribe program, continues to develop electronic communications standards for a wide range of uses, and this year was focusing more on cyber-security (after hackers exploited a SWIFT weakness to steal $81 million from the central bank of Bangladesh’s account at the Federal Reserve) to defend the SWIFT electronic transaction platform.
We also heard a lot of buzz about new Fintech developments such as cybersecurity and artificial intelligence (e.g. creating algorithms that could manage simple investment portfolios as well as most human advisors).
Blockchain: From cyberpunk to competitive advantage
Of all these new technologies, blockchain was a key discussion at SIBOS. The conference was full of questions about blockchain: How does it work?, what does it mean for us?, how will payments be affected?, who is working with it?, and what are the real security issues?
“Blockchain” is a type of distributed, online database that keeps a permanent, tamper-proof record of financial transactions. It was created to settle trades in Bitcoin, the virtual currency, and has since become popular for deals in “real” currencies because all parties can track the transaction securely, with no need for third-party verification.
SWIFT is interested in blockchain technology even though – or maybe because – it could pose strong competition to SWIFT’s own secure payments service, which can take days or weeks to settle a complex transaction. Fintech competitors using blockchain are forecasting that they will be able to cut transaction time down to near-zero.
“Let’s get it done”
However, what interested us most about SIBOS 2016 is that despite all that buzz, there was still a core of business as usual – practical, “let’s get it done” business. The banks still face the same issues: “How do we do this payments business faster, cheaper, and take better advantage of the relationships it creates?”
For example, client onboarding continues to be a challenge for many banks, and we provide a lot of value in this area. We had many discussions about how OpenText helps banks to improve their overall compliance, get to revenue sooner, and achieve higher customer satisfaction rates.
We also had conversations about the wealth of data that banks have and how they can enable better use of it, for both themselves and their customers. While they may be experimenting with new technologies driven by the Fintech boom, the practical business in the next cycle will be in establishing value from the networks and relationships already in place.
OpenText’s role in the new Fintech world
Naturally we feel OpenText has a role to play here. To start with, OpenText™ Analytics solutions help financial companies extract more value from their information by liberating it from the many separate silos it’s often housed in and integrating these various streams of information into a complete, accurate picture of investment performance, customer satisfaction, user experience, or response to various marketing incentives.
Our message attracted a lot of interest at SIBOS, where we had great meetings with clients and prospects. One of the highlights was our Oktoberfest party co-sponsored with SAP, It was a great success with more than 260 people attending.
Next year, SIBOS will take place in Toronto, Canada’s financial capital – not far from our corporate headquarters in Waterloo. Who knows what strides the Fintech world will have taken by then?