At last month's Sibos conference bobsguide sat down with Damian Richardson, Head of Payments Strategy & Innovation at NatWest, to discuss the banks plans concerning PSD2 and future collaborations with fintech.
What is your role at NatWest?
I work in payments services at NatWest, looking at our payment strategies and innovation for all our customers. From consumers to top corporate clients and banks, we look at what they need from our services and we can help solve their pain points and come up with new propositions that will enhance the consumer’s banking life and help corporates increase their profitability.
What are your main objectives at Sibos?
From the banking point of view, we’re talking to our correspondent banks and meeting clients and banks from various countries. The event is beneficial to us to really understand what’s going on in the market. It’s very much an opportunity for us to extend our relationship with our clients and to see how we can improve our services.
Sibos showcases the future from SWIFT’s view, the future from the vendors’ perspective, and all the fintechs.
We work with incredibly talented fintechs to really improve our customer experience and improve the way we deal with our customer interactions.
You spoke on a panel discussing PSD2. What was your focus?
The focus for us is PSD2 and Open Banking in the UK. PSD2 has been featured regularly at Sibos. Yes, PSD2 is a compliance project and we have to do it to meet the regulators requirements, but I’m really keen to see what opportunities there are for banks in the midst of this change.
We’re using technology with open banking APIs that allows several third party businesses, so there’s no reason why we can’t be a third party ourselves and offer new services.
Open APIs are very common in other industries, especially in tech – most of us use open APIs without even noticing. It’s interesting exploring what the new services are that we can offer by having our own open APIs. It’s about understanding what’s out there and where the industry is heading, and knowing how this can improve our business and help the way we serve our customers and improve their banking experience and improve business efficiency.
How do you view fintechs from a banking perspective? Do they have the upper hand?
If you came to Sibos a few years ago, fintechs were very much in the challenger position and ready to take over the industry.
Over the last couple of years, we’ve seen a paradigm shift; there’s the advantage of being a big tier bank with the volume of customers, the brand, trust, and existing propositions. The fintechs are nimble and agile and have great innovative models. If you’re able to combine the two in a mutually accepted way, then the customer gets a better overall experience.
One of our fintechs we work with is Biocatch – we’ve integrated their services into our corporate banking channel, so we use their technology to identify potential fraud with their tech using biometrics. This has helped keep our customers even safer and secure. There’s a benefit of going out and scouting fintechs that we can work with to fix customer pain points.
Will we see a lot more collaboration happening this year?
There’s a lot of collaboration happening. The more open the infrastructure gets, there’s more of a mutual benefit of collaboration.
Overall, it’s all about the experience for the customer. We all know that if we download an app, and it doesn’t work or it’s not easy to use and you don’t trust the brand, it’s going to be deleted almost instantly. So it’s analysing how we can work with fintechs and businesses to improve our technology and brand and still provide the trust and legacy big banks are equipped with.
For the consumer, what does the future of banking look like?
I think it’s going to be completely based on customer needs. Our CEO Ross McEwan frequently speaks about the concept of the customer wanting keys for a house rather than the mortgage – you don’t want a personal loan for the car, but you want the car – consumers want the freedom.
I think we’ll see more services from banks that integrate better with the day to day life of the consumer that will allow businesses to operate more efficiently. This will happen over a period of time, and using technology and artificial intelligence in driving this change will be key.