Words: Ewen Hosie
Illustration: Angela McKean
Brett King is a man on a mission. The prominent futurist was inspired to found the mobile banking app Moven while he was doing the tour for his best-selling book Bank 2.0, a speculative examination of the future of banking. An Australian born in Melbourne but now based in New York, he sees a distinctive future for banks — one without physical branches. He envisions that by 2020, people won’t need to go to a bank branch to pay at all, as we will all be using our phones instead.
“How would that change the way a bank account works?” he asks. “You wouldn’t need a signature, you wouldn’t need physical artefacts; it would be very information- and context-based; what is a bank, and what is the next evolution of a bank account?”
The use of robots in banks is a concept still in relative infancy, though there have been some notable breakthroughs in this field in the last few years. Tokyo-Mitsubishi UFJ has a diminutive robotic assistant called Nao placed at its central branch by Tokyo Station, which has been ‘employed’ to greet customers and help them with simple day-to-day interactions and administrative tasks. Nao has been introduced as a potential way to help internationalise the Japanese banking experience in preparation for the 2020 Tokyo Olympics; it can recognise several languages and also utilises facial recognition systems. At a cost of around £5,000, the robot represents a significant saving on a human employee in a similar position.
Meanwhile in Chennai and Mumbai, Polaris FT has created Robin, a robot ‘bank manager’ that can help customers with banking and insurance issues, and speed up tedious application processes for customers, with the intention of rivalling the expedient experience provided by an app.
But such efforts may not necessarily prove the best approach given the preponderance for an increasingly online-looking banking future, and the rise of the sharing economy.
“You have to look at the trends in branch engagement overall,” says King. “It’s massively down because we just don’t need to go to branches as much as we used to, so whether you put robots or humans in those branches is not really going to reverse that trend. I think the biggest change we’ll see over the next 10 years will be some sort of personal money coach built in to a Siri-like competency, which can manage your money on a day-to-day basis, giving you advice on purchases, or how to save better, or whether you should take that part-time job at Uber on the side, or how many hours a week you should work with them to supplement your income — these things will become embedded in your cloud or your digital ecosystem. I think that’s a more prominent form of machine intelligence when it comes to banking and money matters that we’ll see become more dominant than a robot in a building.”
Though King sees a banking future better served by automation than automatons, he concedes that there may be some room for robot servers as a form of marketing, but that the future for robotics in banking will appear in more subtle ways.
“I think there is a possibility for some sort of in situ service capability in various scenarios and whether it’s a robot or a human we can be a bit agnostic about. I think we will be starting to see robotics, as long as you see robotics as machine automation, not just in the physical form of a robot,” he explains. “Things like voice response systems are getting pretty sophisticated in terms of natural language capability, including biometrics and voice recognition, and these sorts of things will become more commonplace, but the problem with robots, as with humans, whether advisors or tellers, is really around location.”
“There’s a lot of biomimicry in robotics. There is an advantage to this in terms of its comfort level, except when you get to the Uncanny Valley, where a robot looks close enough to a human that it’s scary”
British bank branches are in decline. In 1990, there were more than 17,000 across the country, but the Campaign for Community Banking Services has predicted that there will be fewer than 7,000 by 2018.
Increasingly, young customers have turned to online banking and apps in lieu of visiting branches. There is debate over the future direction of the banking industry; King believes that in the next decade, we may not have any branches left at all.
“What we tried to do with Moven in terms of the design of the business was to create a benchmark for a downloadable bank account with the realisation that by 2020, people wouldn’t go to a bank branch to open one, but just download it to their phones,” he says. “Robotics aside, this is an overarching behavioural shift that we are seeing societally, and will only be accelerated as two billion people enter the banking system over the next decade, exclusively on their phones.”
Indeed, in countries that have no precedent for the banking experience, it may be easier for such a notion to take hold than in countries with more firmly ensconced banking habits:
“There are people who’ve never been in banks before in the developing world,” says King. “So the world’s bank account will be the phone by the middle of next decade, if not sooner, and that will change the way we think — in 10 years’ time it will become completely normal, in the way that it is normal today to write someone an email instead of writing them a letter.”
It may take some time for people to make the adjustment, but the impact felt by such disruptive influences is nothing new, and harks back to other revolutionary influences such as the radio, TV or the internet itself. A point of concern over the digitisation of banking is identity protection, but King maintains that it may actually prove safer than current methods, which he deems archaic.
“Well it’s funny isn’t it, because we are concerned about security, and concerned about how increased digital transmission of money and so forth will affect things with regards to fraud, but a signature is about the weakest possible artefact from a security perspective we could ever think up,” he explains. “It’s something that came about a thousand or 1,500 years ago, and it is no longer a unique identifier; it’s not secure in any form, it’s a really bad mechanism for identity management and security. Why do we still use signatures for account opening for example, where nine out of 10 banks still require you to sign a signature? It just doesn’t make any sense.”
“The world’s bank account will be the phone by the middle of next decade, if not sooner … it will become completely normal, in the way that it is normal today to write someone an email instead of writing them a letter.”
It will probably take around 20 to 30 years for people to truly get past the notion that digitisation represents a threat to personal security, and that given the openness surrounding today’s society with regards to the transparency of information posted on social media, we will need to ‘upgrade’ our concept of identity as a society. King says: “We need to decide what information is private and sacrosanct and what is public with regards to our identity. Our date of birth, for example, should never be used as a mechanism for defining who we are from a security perspective exclusively, because it’s something we regularly share — stuff like that we will have to rethink.”
Whether the future of banking involves bank branches served by robot staff, or the death of the bank branch altogether, it will hold momentous changes. The experimental use of robots in banks in India and Japan could serve as a comforting influence for customers on a psychological level, but there are limits to this. The attempt to emulate traditional methods through new technology is referred to as biomimicry. “There’s a lot of biomimicry in robotics,” says King, “but there doesn’t have to be. There is an advantage to biomimicry in terms of its comfort level, except when you get to the Uncanny Valley, where a robot looks close enough to a human that it’s scary. I think if we are going to have humanoid robots the trend for a period of time will be to make them clearly, distinctly robots, and not try to mimic humans too closely, certainly in terms of facial expression. As we talk about augmented virtuality and augmented reality and digital overlays into our world, augmented data feeds, augmented imagery and so forth — it is going to change the way we perceive the world as well. I think the vast form of robotics will tend to stay away from human emulation.”
This story is taken from the third issue of Poppy. Our print run is strictly limited but, if you are based in the UK, you can request a printed copy via the ReadPoppy.com website.
Brett King is the CEO of mobile banking app Moven, and a prominent author.
He has also spoken to international audiences on the future of banking, and is the host of popular radio show BREAKING BANK$, which is listened to by millions.
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