13 June 2017

Financial Services

FinTech

From counter to Internet

Interview with Alain Grijseels, Head of IT, FSMA

Will bankers be replaced by robots? Will most people soon be purchasing their car insurance online from Amazon? And, if so, will they pay in dollars, euros or... bitcoins?

Technological innovations have recently been shaking up the financial world with increasing frequency. Should this be a cause for concern or should we perhaps be looking forward to all these new tricks and devices? We asked Alain Grijseels, Head of IT at the financial regulator FSMA, for his opinion.

Banks and investment companies are going online whenever possible, since that is what consumers also do with increasing frequency. Consumers use the Internet to easily and quickly manage and monitor their bank account, insurance policy, investments etc. But how far can things go in this direction? Will bankers soon be completely replaced by robots?

"Oh, but there are already lots of robots in the world of banking and investment," explains Alain Grijseels of the FSMA, the Authority for Financial Services and Markets, which, together with the National Bank of Belgium, is responsible for overseeing the financial sector in Belgium. "For example, if a customer asks for investment advice, it's handled, more often than not, in an automated fashion, in other words by intelligent software that is connected to the necessary sources of information."

Too late or not?

The most important innovations in the financial world come from so-called FinTech companies: startups that have built a business model based on a single strong idea, or technology companies that specialize in financial services. Experts are convinced that the banks have missed the boat in that regard.

"That's a difficult question," says Grijseels. "They certainly have already taken initiatives to encourage innovation. But an aircraft carrier needs more space and time than a small cruiser to change direction. That's why some of them now work with innovation incubators, where people with a business background are tend to be linked to those with more technical expertise to develop new interesting innovative ideas. This combination is often successful in encouraging innovation."

Innovating is actually a very difficult task for companies in the financial sector. After all, innovation means: trying things out and experimentation, some of which will result in failure. But, of course, financial institutions must, above all, radiate stability and trust. "It's no simple matter to satisfy both these requirements at the same time," explains Grijseels. "A great deal depends on the reliability of the new digital products launched on the market. In contrast to companies in other sectors, banks cannot permit themselves to introduce half-finished products on the market."