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SRM Perspectives on Key Industry Trends

Despite Crypto’s Correction, No Change to Fundamentals

Posted by Larry Pruss on Jul 8, 2021 10:00:00 AM

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Bitcoin has lost half of its value since reaching an all-time high mid-April. Although one might think this setback would cast a pall over a gathering of cryptocurrency enthusiasts, the overall tone of Coindesk’s Consensus conference in late May remained constructive and upbeat.

For those keeping their eyes on the prize, these two paths are not contradictory. Crypto’s long term value proposition hinges on its adoption as a means of exchange, not its volatile pricing as a speculative asset class. And there’s no sign of slowing down among large financial institutions and scrappy entrepreneurs creating trading and custody platforms and expanding payment capabilities for digital coins. These are the areas where banks and credit unions of all sizes need to take note.

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Topics: Vendor Contract Negotiation, Bank Vendor Management, Credit Union Vendor Management

How FIs are Exploring Fintech

Posted by Paul Davis on Jun 30, 2021 9:36:00 AM

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Financial Institutions (FIs) have long had a curiosity regarding fintech.

There were concerns that these digital disruptors would create more competition for traditional financial services providers (without as much regulatory oversight), but banks and startups are starting to embrace opportunities to collaborate.

Conversations about partnerships between FIs and fintech intensified in the wake of the coronavirus pandemic, as scores of consumers and businesses became digital converts and there was a greater need to make day-to-day tasks easier (and safer) for those customers.

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Topics: Fintech, Digital Banking, Online Lending, M&A

Pandemic Impacts to Consumer Banking Behavior | SRM Academy Survey Analysis

Posted by Pete Bainbridge & Jehan Sherjan on Jun 23, 2021 9:39:39 AM

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In 2020, SRM conducted three surveys to shed light on the financial services industry’s approach to navigating the pandemic. Our March and June surveys focused on bank and credit union executives’ responses to COVID-19 and their strategies for delivering uninterrupted service to customers.

Six months into the pandemic, we further rounded out the picture by commissioning leading research firm Harris Insights and Analytics to collect data directly from US consumers. This survey assessed how their banking habits had evolved since global lockdowns began, and how they might continue to change in the future. The results were further analyzed by SRM’s Europe-based Data Analytics team, which specializes in consumer behavior and loyalty insights.

The findings revealed some important differences by segment with key insights for go-forward digital banking strategies.  

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Topics: Digital Banking, Consumer Behavior, Virtual Assistants, Intelligent Automation

Defining Decentralized Finance (DeFi) | What It Means for the Future of Banking

Posted by Larry Pruss on Jun 15, 2021 9:30:00 AM

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Traditional financial institutions are facing a new wave of crypto-enabled payments disruptions, and many don’t see it coming. Even so, lending as we know it is about to change.

In a recent post, I stressed the importance of banks and credit unions preparing for rapidly emerging financial technologies like CBDCs (central bank digital currencies) and DeFi. This post will take a closer look at what DeFi means for banking as we know it, and encompasses borrowing, lending, investing, payments, and digital wallets.

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Topics: Fintech Vendor Selection, Decentralized Finance, Lending Consulting

Digital Banking Dispatches from the Beach | On Shoring Up Your Virtual Identity

Posted by Rob Coile on Jun 6, 2021 9:15:00 AM

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It’s not surprising commerce continues to migrate to digital channels across all sectors and that the pandemic has pushed further the already speedy digital banking trend. In the FI world, consumers rely on their bank or credit union’s virtual branch to navigate real-life decisions.

A recent family trip to Florida’s gulf coast reminded me of how much importance customers put into “What it says on the website.” We visited an area decimated by Hurricane Michael the year prior; although it remains a beautiful destination, the storm’s impact was still evident. Some businesses only had websites left standing, as we soon came to learn.

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Topics: Digital Banking, Vendor management, Process Optimization

Three Ways to Rebuild Financial Institution Operations in 2021

Posted by Jesse McGannon on May 25, 2021 9:02:00 AM

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Over the last year, chaotic disruptions have upended traditional operating models at financial institutions (FIs) worldwide, and many are only now stepping back from "fire drill" mode. As for the leaders of these institutions, their task is to now scale up and rebuild operating models - ones adapted to their current (and future) post-pandemic environment.

After a period of such intense disruption, here are three ways to check and double-check the blueprint when rebuilding an FI's business models.

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Topics: Bank Vendor Management, Credit Union Vendor Management, Banking Operations, Process Optimization

Major Mergers Signal Surge of Regional Bank Consolidations

Posted by Myron Schwarcz on May 19, 2021 11:15:00 AM

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Though the pandemic caused a slowdown in banking industry consolidations, a recent surge of M&A activity is already breaking records. New data published by S&P Global shows M&A transactions delayed by the pandemic are not only pent-up in numbers, but they’re also getting bigger - extending to regional and super-regional banks holding $10 billion to $1 trillion in assets.

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Topics: Banking M&A, Bank Merger Strategy, Consolidation Advice, Credit Union Combination

Central Bank Digital Currencies (CBDCs) Take the Global Payments Stage | Defining the Crypto Role for Banks and Credit Unions

Posted by Larry Pruss on May 2, 2021 8:15:00 AM

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Bitcoin’s value - which has doubled in 2021 - continues to generate headlines but, behind the scenes, something even more significant for banking, as we know it, is happening. Central bank digital currencies are now emerging from experimental trials, disrupting the norm, to take a leading role on the global payments stage.

As for banks and credit unions, we recommend researching and rehearsing your crypto lines (of business) for showtime.

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Topics: Payments, DeFi, Disruptors, CBDCs, Central Bank Digital Currencies, Cryptocurrencies

Hope for the Best, Plan for the Rest | Three Scenarios for Operational Excellence

Posted by Patrick Goodwin, President on Apr 25, 2021 9:00:00 AM

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With vaccinations ramping up and most businesses reopening this spring, it’s getting easier to envision a return to normalcy later in 2021. Even so, neither Main Street entrepreneurs nor bankers are quite ready to heave a sigh of relief.

As has been seen...and experienced, some need more assistance than others, and some have proven adaptable to new conditions, whatever comes next.

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Topics: Vendor Contract Negotiation, Operational Excellence, Bank Vendor Management, Credit Union Vendor Management, Bank Consulting, Credit Union Consulting, strategies for credit unions, Consulting For Banking Operations, Consulting For Credit Unions

The Latest Evolution in the Battle to Regulate Payments

Posted by Myron Schwarcz on Apr 19, 2021 8:00:00 AM

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The business world is awash in trade groups and industry associations, but a new player's recent formation deserves special attention. The creation of the Payments Leadership Council (PLC) marks a significant milestone, one with the potential to shift the dynamic in the ongoing tug-of-war impacting card payments systems regulation.

The PLC brings together the CEOs of the four major card networks (Mastercard, Visa, American Express, and Discover) as well as those of the "Big Three" payment processors (FIS, Fiserv, and Global Payments). Equally notable is the PLC's appointment of Raj Date as its Founding Director. Date's past experience as Deputy Director of the Consumer Financial Protection Bureau – where he played a central role in the agency's launch – is a clear signal of the PLC's intent to engage more deeply in legislative corridors. Recent events demonstrate why this is a savvy move.

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Topics: Payments Leadership Council, Fed Interchange Fees, Payments Regulation, Card Networks, Major Payments Processors

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