How the rise of fintech is transforming banking

At Money 20/20 Europe in Amsterdam, Standard Chartered’s Kahina Van Dyke took to the stage to discuss an unfolding “cultural revolution” in financial services.

Van Dyke spoke of a “cultural revolution” in financial services at Money 20/20 Europe

Van Dyke, who heads up Standard Chartered’s global digital channels and data analytics, began by identifying three drivers of change that are flowing downstream from fintechs into traditional banking.

Van Dyke spoke about how the “existential fear” of fintech upstarts is a great motivator for transformation within so-called traditional banking. Additionally, the fluidity of talent, Van Dyke says, means people no longer have to work for a company in the city they live in and can move freely between the two spheres.

“You can work for company’s that are on the other side of the country, or quite frankly, on the other side of the world,” Van Dyke says.

“The dynamic around the employer-employee relationship, where I work for a company for 20 years and then I get a pension, that’s all been dead for a while,” Van Dyke says. “The war for talent is over, and talent won.”

Van Dyke believes we are in the midst of a “cultural revolution”, not just within financial services, but more broadly around what she terms “traditional command and control structures”.

She says expectations of human beings have changed and in this moment of transformation, spurred on by the Covid-19 pandemic, people have reassessed what is important in life and are no longer willing to put in 90-hour weeks in rigid and conforming work environments. “People are leaving places that don’t fit with their values,” Van Dyke adds.

“We have to be more empathetic and human-led within financial services right now.”

Van Dyke went on to discuss the key challenges facing legacy financial services as they march towards digitalisation. “Technology is not the challenge, technology is the easiest part,” she says.

“The hardest part is challenging a culture that is driven by certainty. Control. You’re actually asking people to lean into things they’ve never done before,” Van Dyke says, referring to an industry where expertise has always been king.

“All of a sudden, the answer might come from the 25 year old at the table,” she muses. “The question is, are they empowered to be authentic? Are they still in a very structured command and control hierarchy where they have to wait to be spoken to?”

She believes the biggest shift in legacy financial services such as banking is learning to unlock that human potential. For fintechs, Van Dyke says they got “so big, so fast, and overvalued” that they haven’t learned many of the basics, such as AML, KYC, treasury and risk management.

“There’s some boring, boring stuff that is really, really important to make sure we’re not financing terrorists,” Van Dyke says. “I’ve worked at big tech, I’ve worked at banks, they all have strengths, but are they willing to look at where they’re weak and reach out across to people who could complement them?”

Nonetheless, these days all banks are fintech companies, Van Dyke believes. “If you are working for a bank that does not know that it’s a fintech company they probably won’t be around in 10 years.”

The age-old debate of banks vs fintechs is “quite frankly, lazy”, Van Dyke concludes. “We have to elevate the conversation a little bit and bring in more sophistication as this industry is evolving, and the lines are getting blurred.”