You have to give it to the Economist. It’s the most well-written magazine on the planet, and they do such a good job with their Special Sections. This week is about International banking http://www.economist.com/printedition/specialreports?year[value][year]=2012&category=76985 and they put a big emphasis on the future of retail banking. Remember Wingspan, Citi f/i, Netbank, Egg? Well they didn’t revolutionize banking business models, but they did make them a lot more convenient to use. In this magazine, it is asserted that wholesale banking is making no more money (as defined by ROE) than in 2002. Retail banking is the way to go…but – what about those regulatory pressures, inability to make money on fees, nor on interest rate spreads. Well, technological innovation used to be a ‘nice to have’ for convenience of users, but now it’s a forcing function. Smartphones and tablets are radically changing the way customers use their banks – how about automating the checque deposit (gotta love that advert where the photo of the lion is also inadvertantly transferred to the bank branch along with the cheque). Hey – as a Danish banker is quoted, “when you are comfortable divorcing online, banking is easy.”
Good articles… (Branches: withering away, Spain: dispatches from the hothouse, Big data: crunching the numbers, Mobil payments: a wealth of wallets, Remittances”: over the sea and far away, Wealth management: private pursuits, and Winners and loser: world, here we come)…. pick up the magazine.
