Why the utility model is “a necessary evolutionary step” | podcast

By David Beach | 5 July 2018

With tectonic shifts in the global banking industry, digital SMEs are demanding greater services from regional banks.


The intertwined and mutually beneficial set of circumstances that the BASIC countries find themselves in has seen an economic boom with technology and a large consumer market available to facilitate tremendous company growth.

While the conditions in regional hubs are ripe for huge SME growth, the traditional routes to funding and indeed, support, are not.

“Regional banks are running out of partners to support their international operations and financial services to SMEs,” said Mariia Khriachtcheva, director of digital payments at ATB Financial Canada, adding that the new criteria for global expansion banking support bring added cost to bank operations, while managing partnership agreements and navigating regulation in each local arena is a further burden on smaller banks.

This adds fuel to the emergence of the utility model, a growing phenomenon that sees banks “competing with Fintechs on one side, and scaling up to serve more customers on the other” says Devie Mohan in our exclusive video fire side.

“If we look at other industries that have been through disintermediation, it was necessary for them to evolve quickly to offer new business models to their customers. Banking is lagging behind today” says Mohan.

India is currently seeing exponential growth in its SME market with the traditional banking services straining to accommodate these agile and often cross-border start-ups. Fintechs are brought in as best of breed solutions to partner with banks, to reconcile the dilemma that Mohan and Khriachtcheva describe.

We spoke to Shubhanga Prasad, Vice President of Digital and Fintech strategy at YES BANK about the demands the SMEs in the regions are voicing, how they are making the best of the bank’s fintech accelerator and where blockchain can drive efficiency in this fledgling financial hub.

Where is YES BANK situated in the market and what is your approach to fintechs?

What are some of the recent demands that you have come across from your business clients on cross-border payments improvements?

Is blockchain the ‘harbinger of disintermediation’ and/or where do you see it having its fullest effect?

For further reading on the emerging utility model, please see the whitepaper ‘Reimagining global banking services in the connected digital marketplace'

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