Banks 2020: Partnering with Treasury & Receivables Leaders for Digital Transformation

[0:00] Anchor:

Our topic today we have a really great group of panelists here to talk on kind of banks 2020. So what is partnering with Treasury and receivable leaders for digital transformation? So, with that, I’d like to invite kind of our panelist up. Our first panelist is from Bank of America, Rodney Gardner, head of global receivables and global transaction services. From Citibank, we have Preeti Chaturvedi, Global Head of core receivables. From Commerce bank, we have Aaron Bach, Vice President. With PNC, we have head of product strategy, Eileen Dignen. And finally, I’d like to welcome up Vikram Gollakota who is our vice president of solution engineering with HighRadius.

[1:03] Vikram Gollakota:

Thanks for coming. This is the second time we’re doing this. Some of you were here last year. So I want to start with what we talked about last year. So let’s play a quick video.

[1:21] Video:

Look around our offices now. And we have a lot of millennials working and they’re never writing a check, and never will in their entire lives. So as they become a little bit older and move into businesses, I think you’re going to have the natural shift or probably an acceleration toward electronic payments and wholesale.

If I look at the average person in this room, I would actually think that in our careers over here, we would see a world without Jen’s, we’ve got a big push around the paper to electronics.

And I for one have never really pushed my clients to move off of paper until I could give them an alternative tool that would mock up, how’s that for business term? They’re straight through the reconciliation process.

Its consumers are driving innovation. And we’ll talk a little bit more about this tomorrow. But we’re an in-demand society and payments hadn’t kept up until the most recent innovations in the last really the last year, two years. And we’re looking at our current rails like same-day ACH and, I think the usage for that has picked up beyond our expectation.

Digital transformation is not just about that mobile tool, they’re not just the easy computer interface, but you know, just really thinking about a true end to end process.

[2:46] Vikram Gollakota:

Alright, so we’ve talked a lot about checks last year. So I’m going to start where we stopped. Let’s go around the room and it’s been a year. You all said you had various initiatives, some already out of it. Some are working towards said. So let’s hear again from you all Where? Where are you now? Rodney?

[3:07] Rodney Gardner:

Thanks. Yeah, that I think we’ve hit that that tipping point. If you look at the stats, I think we’re down 789 percent. So, checks are a payment vehicle. We’re north of 50% a year ago. And I think now it’s low 40s. So that process has started. So I think you’ll see more of that. And I think, you know, it could even find its way over into the healthcare space. We’ll talk about that in subsequent questions.

[3:34] Vikram Gollakota:

All right, perfect. So, Preeti, CD Manish last year, gave his vision that in this generation or in our lifetime, we will have a day without checks. Is that still the position that Citibank has, and what are you doing to make it happen?

[3:53] Preeti Chaturvedi:

Yeah, sure. So within payments and receivables business at the city, we are very much focused on providing digital solutions to our clients and enabling clients to be successful in their digital transformation journey. And the focus is not so much on payment methods and instruments but providing value-added services and becoming trusted advisors right? In this era of change, our strategy has been to let outside in and complementing our market differentiating assets through a strategic partnership with Prince FinTech and our HighRadius collaboration. To launch city smart matches one example of such collaboration, you know such execution of the strategy. We’ve seen pretty good adoption from multinational clients who are household names and embracing this strategy. So there is clearly an indicator from clients that they are looking for banks to become that trusted advisor brings the leading-edge technologies to them through FinTech collaboration. And there is a lot more appetite from clients to move towards cloud and API based solutions and really move away from the analog to digital processes.

[5:11] Vikram Gollakota:

Very nice. So Aaron, the first time in this panel for you, maybe if you want to go back one year, what would you have said, then what would you have said now?

[5:20] Aaron Bach:

Yeah, you know, I think a year ago, we would have been still thinking about how we can handle the incoming paper – the checks, what’s happening in that space, as we look towards the future, we’ve really adjusted our philosophy and it kind of aligns with Preeti was saying, of, you know, payment is a payment. And we’re less concerned with sort of the mechanism and the rail itself and more that the customer experience is exactly what they want. And whether that is the payment to get there instantly or quickly. Or whether it’s to go through the paper in the mail. We want to support that and so will continue to evolve with their needs and make sure we’re filling it on an individual payment basis.

[5:59] Vikram Gollakota:

Great, thanks. So, Eileen. you’re the head of strategy for PNC. So tell us what’s coming.

[6:05] Eileen Dignen:

So I’d like to comment on last year’s panel too where Manish said checks are going away. And I think I can look around and I won’t look at anyone in particular, but we’ve probably been saying that for years.

[6:16] Vikram Gollakota:

Yes.

[6:17] Eileen Dignen:

And, you know, the good news is they’ve declined. more good news. We’re down to 5000 financial institutions from 11,000, which is really inherently why we have cheques in the US. But, I think the paper item is going to remain I like the focus of the panel, we’re all saying the same thing that doesn’t focus on that paper check, focuses on the automation behind it, and how we can add value.

[6:43] Vikram Gollakota:

So a lot of you have started digital transformation or journeys or some kind of initiatives with your clients right? Over the last year to can you take like a few minutes to talk about a success story of what is that one initiative that has helped transform your clients digitally? Rodney?

[7:07] Rodney Gardner:

Well, there’s been several, but I’d say the one that’s been most surprising to me. You know, we all talk about paper electronics in the corporate space, it’s the right thing to do. There’s nobody here that’s going to debate whether or not low-value payments is the best way to be paid globally, nobody’s here obviously to debate share solution is the market leader. But what started to happen with artificial intelligence and machine learning is that has now morphed over into the healthcare space. Right. And that caught me a little bit off guard. Right, I thought healthcare would be the last industry to embrace digitization, but it has started. So you and now you know, we all get those crazy explanations of benefits in the mail, when we’ve been to our doctor and we sort of throw them away because we know 30 days later, another one’s going to show up and it’s going to have a different amount. So you just wait till you finally get the one with the lowest amount and then you pay it right. But, now the bots are starting to read those explanation of benefits and all those crazy codes and electronifying that process. So we’ve had a big uptake in that space with our clients using pretty much the same thought process and tactics that we’ve deployed with our intelligent receivable solution, the corporate space, we’re now doing it for healthcare. And if you think from in terms of a, a business model and cost savings, that industry is ripe for change. So that one’s taken me off guard. But it’s a welcome change. So that’s been fun. Little more difficult than, you know, moving from a check to an ACH payment. Because the remittance item is is uber complex. But it started to happen thanks to bots and machine learning. So that’s been fun.

[8:48] Vikram Gollakota:

We love Uber, right?

[8:50] Rodney Gardner:

Yes. Not that Uber.

[8:53] Vikram Gollakota:

So Preeti. What is Citi doing?

[8:56] Preeti Chaturvedi:

So I mean when it comes to success stories, right like Rodney said there are several but there are a couple that comes to mind. So in the last year, we saw clients across sectors adopting, or looking for automated reconciliation solutions with machine learning, right, and leading-edge technology. And it has been quite heartening to watch those slides move from a completely manual paper-based process with about zero percent automation to over 90% automation, right using some of the technologies that we bring to our clients in partnership with HighRadius. So that’s pretty good, right? That’s actually fabulous moving from zero to over 90%. But as you know, that’s not enough, especially when you see trends like direct to consumer, and our clients’ models shift from thousands of businesses to billions of customers and transaction volume increase. There is going to be a need from clients to achieve near a hundred percent automation because even 1% with those volumes could create could have a material impact on operational processes. So yeah, I think the overall the journey has been great, but there’s a lot more to be done, especially as you know, changes, you know, happening at an accelerated pace.

[10:21] Vikram Gollakota:

Totally, change is the only constant! And I get that email twice a week from you-know-who. So, Aaron, what is your journey like you started this year and a half ago?

[10:32] Aaron Bach:

Yeah, it’s been a great journey for us. You know, we truly have adopted a methodology where we call it the voice of the customer. And anytime we talk about our digital transformation, we want to hear from our clients. And we want to hear what is most important to them as they relate to the things that Commerce Bank is doing every single day. And so we do that through panel discussions and outreach with customers and our sales force talking to folks, making sure that as we make improvements to our systems, as we roll out new products and services, expanding things like cash application and collections deductions and the various HighRadius tools that our journey is paralleling with our customers, and the things that we’re doing is really meeting their unique problems.

[11:20] Vikram Gollakota:

So from a strategy standpoint, Eileen, right. This is an important thing, you probably are focusing on great success stories. What is it that I can do? So what is your take on this?

[11:32] Eileen Dignen:

So you asked about a success story. And you asked each of us about, you know, what one thing and I don’t think any of us can say one thing, right? So we’re trying to summarize all these different things that are happening in our organizations, all the common theme of digital, moving to the digital economy and automation. And so I thought I’d talk about an example that my colleague Jay – I see him, that I talked about, you know what one thing we’d like to highlight and Jay was on this panel last year with me because I was from a different institution at that time. So this is really a joint effort. And Jay and I talked about, I know most of you know, he talked about, you know, let’s talk about a client journey. And we had a client who, for good reason, and many of you may be in the same situation have grown in their automation, and they’re moving to a digital economy by putting things together dealing with things that had to happen fast and then adding on to that. So pieces of automation along your value chain, and then you end up with a very complex value chain or complex system of getting things done. And, so I know from a consultative approach, we looked at that and Jay and his team said: Well, okay, there are efficiencies to be had here. And the approach to PNC, which is why we’re all here we pick the best of the breed in the market to partner with like HighRadius. We said if we bring the best of the breed to the table, and we bring, you know, beginning to end, we can help you with the entire value chain, then you’re not dealing with 15 separate partners along the way. And I think that’s something that we’re seeing is increasingly complex for all of our clients’ environments, and if we can help them because we see not only the receivables, but the payables and the information and the data, and that’s our job to do so.

[13:29] Vikram Gollakota:

Right. Nice. So, one thing I do want to mention a lot about getting the best in class. So Preeti, this probably starts with you now. When corporates can go to FinTechs and buy this from them. Why should they work with the banks?

[13:47] Preeti Chaturvedi:

Yeah, and that’s, that’s a great question. I think there is no one size that fits all. That’s one thing we have London transaction banking, right? But Wall Street or banking is a relationship business. So most of our clients have, you know, a strategic banking partners who they go to, right and they are more inclined to have their bank, bring them a technology solution FinTech partner to solve a problem then directly going to, you know, going to the procurement cycle or buying a software, it’s a very different, you know, buying behavior. And in our case, we have seen some of like I mentioned household names, opening up doors, right for such, you know, for FinTech provided solutions as a result of the relationship that we have with them.

[14:47] Vikram Gollakota:

So basically, you are the trusted advisor in their organization. So and you’re taking it to them, they don’t feel as you know, it makes make them it makes them feel more comfortable.

[14:59] Preeti Chaturvedi:

Yeah, it’s essentially a bank-grade vetted solution, right and we have long-lasting relationships with them. They trust us, obviously.

[15:10] Vikram Gollakota:

Great. So what do you think is happening in this space? last year? I have in 2019. I’ve seen so many things that each of you are doing with the FinTech, some of you investing in FinTech, some of you are partnering with them. What’s happening? Why?

[15:27] Eileen Dignen:

So I’ll start with just the landscape. So if you look at 2017 over 2018, M&A activity between banks and FinTechs’, doubled in 2018 (and in) 2019, that number went even went up even further. And so we can all talk about some of the big partnerships or acquisitions that have happened and why is that? Well, one, banks don’t want to give up a space that they believe that they can add value to. And there is a lot to be said there. Two, because the markets consolidating. Not only are the banks as I talked about consolidating, but FinTechs chose a very specific space. And sometimes growth in that space will only come if you add to the value chain. So my prediction is that this kind of activity will only continue to heat up. And we all need to choose where we want to play.

[16:18] Vikram Gollakota:

So, Rodney. I know that a FinTechs that you like and then FinTechs’ that you don’t like, right that might be encroaching into your area. So, you what do you think from a FinTech? If I’m going to start a new FinTech company? What should I be looking out? Should I partner with the bank or should I go against the bank?

[16:39] Rodney Gardner:

Yeah, that’s a great question. I think like a corporate, you know, what’s your, what’s your risk appetite for bringing a new partner into your platform ecosystem? right? That’s one. And then two – If you are outside of the US it’s typically the banks that you will get the most local market knowledge from. Right? So and I totally agree with a trusted advisor. But that goes a step further if you are a company doing business outside of the US I always like to say my product managers hate it when I say this, but I always say the US is easy one currency one Fed multiple regulators, but the US is easy. Once you go outside of the US – let’s take Asia as my favorite example, then it is really hard. And that’s an example where you want your banking partner right there with you to understand the difference between having to onshore in Indonesia and the regulatory environment in Singapore. So I think that’s one reason why you do it. The other is I think, you don’t want to create another point of failure for the bad guys. So typically, and so what do I mean by that – You want to you want the bank to take that platform right? All of us have white-labeled the HighRadius solution. It is best in class, but we’ve brought it inside of our firewalls. So the same way that you talk to the bank to do an ACH transaction, you now talk to the bank through those same host-to-host connections and secure connections to get your accounts receivables reconciled. To me, those are the two big drivers in terms of why one would consider partnering with the bank as opposed to going directly to a FinTech.

[18:26] Vikram Gollakota:

So, Aaron, most of the companies that you have clients that most probably have more than one bank relationship, right? So when you go to them and say – “Hey, I have a nice, fancy receivables reconciliation tool called HighRadius”. How do you talk to them about this at the different banks being in that ecosystem?

[18:51] Aaron Bach:

Yeah, you know, it’s, it’s, it’s kind of driven by what the expectation is on the consumer side. You know, my personal banking account has had access to multiple bank relationships for years. And that is the sort of status quo. I mean, companies like toggle have existed for a long time. And it’s been very easy to see my savings account here, my checking account here. And corporates have come to expect that and they want an ecosystem where they have reduced modules, reduced need to go to multiple places. And by using a solution powered by HighRadius, we can deliver that to them. And no longer do we say you have to go here to check your deposit on ACH, here for your operations account here for your general expenses account. So a single place where all those things are co-located. And that pulls together more data that you can use the analytics tools to expand and know more about your cash at any given time.

[19:47] Vikram Gollakota:

So outside of the HighRadius example, can we talk about one other technology initiative that you are doing to help your corporates, Rodney?

[19:56] Rodney Gardner:

Only what I’m doing is HighRadius.

[19:57] Vikram Gollakota:

Oh, wow.

[19:58] Rodney Gardner:

Okay, just kidding. So if we think about last year, one of the things I talked about in that panel was, you know, the time has come for fewer bank accounts, right. So they’re already fewer banks in the US, that’s going to be true globally, you are going to skinny down the number of banking relationships that you have. But one of the things that will help you do that is sort of the next big thing. And I think that’s virtual accounts. Right. So that’s, that’s taken off. That’s quite powerful. And so that’s been our focus. So if you think about our product roadmap at Bank of America, we did intelligent receivables first, because that was the biggest pain point for our clients globally, how to reconcile their incoming transactions, whether it was check paper, carrier pigeon, you name it, we were there to help you do that. Once we solve for that. Then we turned our attention from a product roadmap perspective, to look at virtual accounts globally. So that’s what we’re building out now, and we’re quite excited because we will embed the HighRadius, our version of it intelligent receivables into the virtual accounts. So at the top into the market, our clients are pretty much saying 65% of them are going to use virtual accounts for all the right reasons. But for the underlying transactions, they’re going to use them to solve, further solve and streamline their account reconciliation process. So with 65% of the top of the market, saying that it only made sense for us to then combine the two solutions. So when you buy virtual accounts from us, you automatically get you’ll be happy to hear this, you will automatically get intelligent receivables as your recon tool embedded in that if you’re using it for receivables. So that’s a big project. Look, I’m a lifelong transaction banker. It is the most complex project that I’ve been involved in. It’s a lot of fun. We’re a year and a half in we’ll go live this year. It is been an incredible journey. But again, that’s another example where we partnered with a FinTech. Right, we did not try to build all of that around the globe ourselves. So that’s been a great journey.

[22:13] Vikram Gollakota:

Great. So Citi, Preeti, so what is Citi’s?

[22:16] Preeti Chaturvedi:

Sure, I’ll take the crowd from where Rodney left, right? So we are also seeing a huge demand for virtual account solutions from clients more with regard to enabling them to centralize their core cash functions, right from receivables, payments, and liquidity and support on behalf of structure. So less focus on rationalization of bank accounts, but more around the strategic use of virtual account to create on behalf of structures, more efficiencies and get instant access to liquidity. So that’s something you know, that’s a product that’s life in Western Europe and North America, and then we plan to roll out to other currency centers. So that’s taking a lot of attention then the other area where we are heavily invested is, again, direct to consumer trend is quite universal, it’s here and now and as a result, we are seeing a boom in subscription models with the CPQ processes getting increasingly complex dynamic with hyper-personalized bundles, and you know the cash reconciliation across all of those models. And as I said earlier, the transaction volumes are increasing. So helping clients achieve increasingly high rates of reconciliation and providing end-to-end bundled solutions with smart match-high virtual account peer ID and a lot of value-added services. So more and more clients are looking for a one-stop-shop where they can get all the value-added services and quote receivables and we want to be that one-stop-shop whether it is bringing our market-leading assets and, you know, partnering with FinTech to provide that seamless experience for our clients.

[24:05] Vikram Gollakota:

Nice. So, Aaron. I know receivables is a newer thing, the whole FinTech thing that you’re doing with us. What about Treasury? What are your thoughts on Treasury as such?

[24:10] Aaron Bach:

So, you know, we’ve gotten had Rodney’s talking about product roadmaps, and obviously, each one of our individual product teams supports a myriad of initiatives in the Treasury space. I’d be remiss if I didn’t talk about sort of one of our biggest initiatives that we really started a journey several years back, which is to replace our existing core technology that our entire bank runs on. And so we have undergone that journey and are in the process of finalizing our implementation to go live with a truly real-time core, which will give us real-time capabilities across the entire organization, not just in Treasury, but throughout the bank and the retail side as well. And that is really building us to sort of prepare for the future. As some of these emerging technologies, real-time payments, and Treasury, things like that become more and more ubiquitous, will be prepared as an organization to handle those things with the new core in place.

[25:18] Vikram Gollakota:

Great. So So Eileen, you are also on the board of real-time payments, right? So, tell us more what’s coming and what’s BNC doing about it.

[25:27] Eileen Dignen:

So, it’s funny, I still hear a lot of feedback about is their demand for real-time payments. And if you break the conversation down, it’s not, you know, corporations are not saying I’d like real-time payments. What we’re hearing is I’d like to be paid faster. I’d like the information to flow along with it completely. And I’d like alternatives. I’d like choices. So what PNC is doing is looking along the entire, like client journey and the request for payment which is to be paid faster. It’s a real-time payment type. So we’ve implemented all of the payment types. For real-time payments, we’re working to see in every product area, how there can be applicability and we’re presenting it to the clients, not as you need real-time payments, but how do we, you talked about liquidity? It is that’s bottom line working capital and liquidity, how can we improve a company’s liquidity position?

[26:23] Vikram Gollakota:

Very nice. So you brought up an interesting point about alternative payment methods, right? So I’m sure a lot of clients here all the way from Europe or North America. So this is going to be a rapid question. What what are the three payment methods they should be considering for 2020? Rodney?

[26:44] Rodney Gardner:

It’s a rapid-fire question? Yeah. So I’m going to sort of reverse engineer that – What I’m excited about for real-time payments as a request to pay. And, and so I’d really like to see that take off. That would be some market standardization. You know, I’ve got a basic rule and product and that never makes the payer do anything different than they did before you implemented the process. Because we’ve seen that movie and we know how it ends, right? So request the pay could be that first real-time where everybody’s looking at the same data. And if you make it user-friendly, and you can populate the remittance detail, that could be a game-changer. That’s what I am most excited about in terms of what the banks are doing. Again, what’s happening in the FinTech space is incredibly exciting as well, but that’s the one that’s that would be my one wish. I’m lukewarm on sorry, real-time payments. Okay, lukewarm. I’m getting warmer, but give me a request to pay.

[27:39] Vikram Gollakota:

Okay. Preeti?

[27:41] Preeti Chaturvedi:

Yeah, that’s a great question. I’m excited about a lot of innovation that’s happening in bank account-based payment methods, which ultimately, you know, when you look from client lens, right, gives them more predictability and control. So there are so many flavors, including the traditional direct debit, but you know, electronic mandates, right, it’s becoming more ubiquitous and more policymakers right moving towards an electronic form of payments. So whether it is the traditional direct debit with electronic mandates, and also request to pay open banking, all of those that ultimately give clients – our clients control as well as buyers controlled with, you know, with the know exactly what is going on. Right. So protection for the buyers and for more predictability for our clients who are selling it.

[28:30] Vikram Gollakota:

So Aaron, when you go talk to corporate, right, you go in and then say, and then you come across as bringing the best technology out there. You’ve never done that in the past. I mean, you always talk about ACH and you talk about payment methods. But now you’re talking about AI and ML. Right. How are you? How is your team? How are the clients adjusting to you talking about AI and ML from: “Hey, I can do payments really well” -conversation.

[28:58] Aaron Bach:

It’s a different method or message really, and everyone has always looked at their bank as their trusted payments partner, right. And it’s where I keep my money. It’s where I initiate my payments where I received my payments. And now we’re bringing them tools that are solving problems they have that are greater than just those that they face in receiving the payment or making the payment. And so it’s about changing the conversation and listening to them to talk about what are the problems that you’re having? What are the areas where you feel like we can start to add value across the spectrum? And where that almost always comes down to are where we here at the most often is in the receivable space. Everyone likes getting paid. No one seems to love posting the information that comes along with that payment. And so by delivering these tools, we can really open them up to you know, the world of automation that they have not been able to get. You know, I think the other thing too is when you come in, and we touched on this earlier, as a panel when you come in as the trusted partner, the financial sort of advisor role as opposed to your banker role, they really see that our expertise, Preeti mentioned, we, you know, our vetting process and the research that we’ve done, they know that we’re bringing in the best partner possible. And having that conversation as more of a consultant, rather than a salesperson has really changed the conversation.

[30:29] Vikram Gollakota:

So Eileen how much retooling did the bank have to do into their employees and there’s, there’s into their account managers into the reps to get the conversation changed from here’s what I got to – “Hey, I’m here to advise you, I’m working with a lot of FinTechs”. And is that going to take some time? Are you there? What’s going on with that would be insane.

[30:53] Eileen Dignen:

So I think it’s taken time for the industry to get there because as we’ve all grown, we have specialization. So you have we have these large teams that are very comfortable about talking about this. So as an industry, I think we’ve organized ourselves in a way where we have the generalists to have that conversation, and you bring in the specialist when it’s appropriate. If we’re not having a conversation about solutions, and we’re just having this conversation about products. That’s the 1980s. That’s we’re not doing our job.

[31:21] Vikram Gollakota:

That’s the green screen. Okay.

[31:25] Rodney Gardner:

Yeah, and I think the other thing that was the aha moment for the banks is we’ve always had the Treasury relationship. So we’re really good at dialing up the assistant treasurer, what was new for us is finding the accounts receivables manager, and bringing them into that dialogue.

[31:41] Vikram Gollakota:

Very interesting. So I have two last questions. Open banking, we talked about this last time, I got mixed feelings. So I’m gonna bring it up again, see if you’re there or you change your mind, where does the US or will the US ever move to an open banking standard? Alright, Preeti?

[32:03] Preeti Chaturvedi:

Well, one hopes so right. And I think recently, there was also a letter from, you know, one of the big tech companies to the Fed, right and moving towards this more open model, as well as inviting non-banks right to participate in the ecosystem, citing the groundbreaking success of UPI in India. So I think we believe right, that is the right model, right, where everyone is bringing the best in class portfolio to ultimately solve a problem right for the entire ecosystem and create a more digital economy. So I think that is the future and when it will happen, it is questionable, but I do hope and look forward to that.

[32:55] Rodney Gardner:

Yeah, and I didn’t mean to fall asleep on the question, but I believe it’s the right direction, I just think there are far more important things that need to be accounted for and corrected in the bank-wide infrastructure. It’s just not where I would focus at the moment.

[33:15] Eileen Dignen:

But we have one major difference, right? The innovation that’s occurring, you know, along with the European franchise and with open banking that’s mandated. And that’s why the letter went to the Fed. The letter went to the Fed to say, can you please push this along? The Fed has not instituted a mandate for much of what the innovation in the US has been. It’s been the onus has been on the bank. So I don’t think the Fed will mandate it. But I think we as banks will get together and say, What should we do? And how do we, we tend to follow each other or group together and do it together.

[33:50] Preeti Chaturvedi:

You know, the pace of change is really slow here in the US and fortunately, and we see a lot of emerging markets right? Rather leapfrogging to a more open instant infrastructure. So whether it comes from the regulators as a publisher, you know, hopefully soon the banks come together to create that ecosystem. Yeah.

[34:12] Rodney Gardner:

That’s right. Because I mean, the Fed could just say, “thou shalt stop writing checks”. I mean, other countries have done that.

[34:19] Vikram Gollakota:

So why is the Fed not saying that?

[34:21] Eileen Dignen:

Because they make a lot of money on checks? Let’s be very honest here. And there are 5000 institutions. Remember, the Fed is the one that sits there that says, we have to be fair to all sizes. You don’t have that problem in other ecosystems, right? So I don’t believe they’ll ever come out and say no checks because somebody will put up their hand and say, that’s the only instrument I can exchange in. So we’re a unique economy here.

[34:47] Vikram Gollakota:

So we are a long way ahead to get without today without checks. Got it. So I’m going to talk about the future now. Right. So there have been banks, there have been FinTechs and this Corporates and I think there’s always a lot of collaboration between the three entities to get, you know, innovation done. What is your prediction for the next five years? 2025? February 5th?

[35:20] Rodney Gardner:

I, would like to see our I’m going to predict that maybe the banks all do come together and think about how can we take friction points out of the banking system? So what do I mean by that? Let’s start on the retail side. Why does every bank have its own branded ATM? Show of hands if you could get money from a secure ATM? Do you care whether it says Bank of America or Wells Fargo? But if I told you you could have three times as many ATMs as you do with your current bank, if the bank’s just brought that all together, you’d say yeah, I’m all for that. So I’d really like to see the banks take a step back and say – Wow, could we all do ATMs and they have just say, they’ll be branded. So you know, they’re secure. They’ll say, bank ATM, right? And you can go there if you’re a part of the 25 participating institutions. Other friction points. Why do we all have a platform for Fed wires? How about one galactic US platform that does Fed wires for all banks? It’s not a differentiating feature. Something is arcane is cash vaults. Why Couldn’t there be one super galactic provider for cash vaults? Like there’s still all this friction in the system that would allow banks to take the expense out so that we could innovate even further? Right? So I’ll get off my horse now.

[36:55] Vikram Gollakota:

Okay, Preeti.

[36:57] Preeti Chaturvedi:

Yeah, look, I see the traditional roles and boundaries sector boundaries are blurring, I see the collaboration between corporate banks and FinTechs is very much here and now. By 2025. I look forward to a world where we have artificial intelligence, Internet of Things, industrial IoT, 5g or maybe 10g, acting as the glue that brings together and binds these three entities, corporates, banks, and FinTechs and working in full steam. I think there is also a great opportunity for these entities to partner with public sectors right and create Smarter Cities, as governments around the world look to modernize their infrastructures. There’s a lot of lot that that corporate syntax and bangs can bring to create that smart city economy. So yeah. 2025 is definitely going to be world off ecosystem with these entities working full steam, and we want to leave the financial layer for that.

[38:08] Vikram Gollakota:

Great, Aaron?

[38:09] Aaron Bach:

Well, Vikram, I think you’d agree with me when I say at least five more Super Bowl championships for the OG?

[38:15] Vikram Gollakota:

Oh Yeah. OG.

[38:15] Aaron Bach:

Yeah. All right. So that’s first, obviously, you know, after that I look at ways artificial intelligence is changing the game across the board. And what we encounter so often is that the customers that we’re talking to, are really, really excited about it. And they don’t really understand that yet. And they don’t really trust it yet. And all we really need to do is sit and explain all the way it’s happening around them today. And it really opens their eyes to – Wow, I interact with this technology almost every single day and I don’t even realize it. And I think that’s going to become more and more omnipresent. I think we’re going to get more and more used to it being all around us and that is going to weave its way into our lives and the way we handle our finances both personally and professionally. Again, this concept of the consumer first is driving all these things and in the b2b space, they’re going to continue to rely on these emerging and artificial intelligence-powered technologies more and more to the point where the working landscape is going to begin to change.

[39:25] Vikram Gollakota:

Eileen, what are your thoughts?

[39:25] Eileen Dignen:

So a couple of thoughts. Unfortunately, in five years, I think we’ll still be saying winner checks going away. I believe the generation that right now doesn’t care about security, when they go into apps and do their banking will start to care because they’ll have more money to care about. So I believe banks will have to be a little bit more nimble, but still focus on security. And I think, you know, the banks that don’t innovate. I spoke last week at another conference and I said innovation is a daily activity. And I truly believe that and those of us that don’t continue to innovate won’t be here to talk to you in five years.

[40:03] Vikram Gollakota:

All right, perfect. Well, thank you all. Thank you all for taking the time and helping the audience educate about all these topics. We hope you back here again next year. We’ll play the same video again. So looking forward to it. Thank you!