[Jane Adams] At the recent 6th London BarCampBank Unconference, organised in London by Consult Hyperion, 90 attendees managed to leap the waiting list and attend the sold out event.
Unlike traditional conferences, unconferences focus on generating ideas and knowledge from all attendees. First of all we asked each delegate to write down their interests on post-it notes. We then sorted these into themes and delegates were seated in round table discussions according to theme. The ensuing discussions were both vital and intense and generated a wide range of visions, wishes and inspirations about the future of payments. Here are the main outcomes.
One key theme was the nature of the future bank. Was it a platform? Was it a utility? How did it differ from non-banks and near banks?
While delegates disliked the idea of banking as a utility, there was some interest in the idea of the bank as a trusted service manager, presenting a set of APIs to applications whose quality would need to be rigorously controlled. The real innovation would come in the area of distribution of these services and applications.
There was concern that not everyone understands that what separates banks and non-banks is the taking of deposits. Perhaps the varying terminology doesn’t help – to near-banks and non-banks, attendees added the neologism neo-banks. However despite the industry leading role of many of the attendees, only 50% professed themselves ready to trust new entrants.
Add to that a regulatory regime that seems to benefit incumbents and new entrants might have a problem. Delegates stressed the importance of regulation that benefited customers as well as banks, leading to greater transparency and a pro-innovation mindset.
One area of genuinely contentious discussion was whether in this future scenario, Visa and MasterCard had a role to play. There were few ideas about what would happen to what one delegate claimed was the 3.6 billion accounts that currently carry association branding, nor to how the industry would do without chargeback. However there was some suggestion that the future might reverse a past trend with a return to smaller local brands rather than another global acceptance brand.
One of the biggest questions is what will happen to cash. Dave Birch makes no secret of his views on the burdens cash imposes on the economy but attendees seemed to think that if cash disappeared there would need to be some sort of replacement. Cash was seen as local, convenient, trusted and personal and any replacement would have to have those features too. Anonymity and privacy were also seen as desirable features. A future visioning ‘writers’ discussion’ which I chaired ran with this idea and came to the disappointing conclusion that the replacement for cash was probably cash.
One brighter idea was that there could be different types of money for different purposes, with money shifting away from being something national towards becoming something specific to different types of economy.
Prepaid should be free with the business case coming from added value to both parties, unlike many current prepaid approaches. In fact customers could even receive discounts for using it, with aggregators enabling the customer to compare and choose the best discount.
Delegates were also asked why mobile might be better than cards. Partly this question foundered on definitions but three points to consider in any discussion were defined – the axes of security versus usability and innovation versus regulation and also the question of who holds the power to take mobile forward – merchants, schemes or consumers?
Identity played a large role in the discussion, although there was much disagreement about how banks could be involved. Some felt that banks were uniquely placed to provide data provisioning for identification services but others pointed out that identity on the Internet is multiple and much more subtle than pure KYC based identity. Where ‘what we are’ is more important than ‘who we are’, a link between the two may not be helpful.
In all cases, payment should be under the control of the payer not the payee – my money, my control – with friction being self imposed. That means any viable future alternatives to current payments methods must feature push payments.