Marketplace Banking


Banks are locked in a traditional structure of proprietary and legacy, and they strongly wish to keep it that way. The problem is more and more banking operations are increasingly done in marketplaces that level the playing field for new entrants, writes banking consultant Chris Skinner in “The banking bazaar and the bizarre banker.”

This week I came across a number of articles covering the shifting market forces shaping the future of money, finance, and banking. In the uncertain ecosystem that new technology and innovation produces, Mr. Skinner concludes with one certainty, “For a bank that has zero technology vision, has zero understanding of microservices architecture, has zero appetite for open sourcing and has zero knowledge of platforms and marketplaces has zero future.”

Enough with D.C.’s mixed messaging on FinTech

Markets are uncertain, and regulated markets, like financial services, look increasingly to governments to set the rules of engagement. The U.S. Congress gave it a try this week, expressing a sentiment that would be difficult to disagree with, on the need “to promote consumers’ access to financial tools and online commerce to promote economic growth and consumer empowerment.” Probably why only four voted against the resolution to create a resolution. Jackson Mueller, deputy director of the FinTech program at the Milken Institute, suggests that more is required and gives an update on the U.S. Office of the Comptroller of the Currency’s regulatory efforts.

When it comes to lending, asset managers are the new bank

Middle-market companies are increasingly turning to corporate lenders rather than banks, but that doesn’t make them a significant threat to the financial system, writes Tony Ressler, co-founder, chairman and CEO of Ares Management, in a post for Institutional Investor. However, this shift could create “ a lot of disruption in the lending system, reduces protection and almost promises a deeper recession the next time we run into one,” says Dick Bové, research analyst at Rafferty Capital Markets.

Moody’s expects residential mortgage-backed securities from marketplace lenders

Moody’s latest report signals the move of mortgage backed securities to marketplace lending platforms. But existing laws require a higher degree of compliance compelling new online entrants to “make significant capital and knowledge investment,” writes J.D. Alois for Crowdfund Insider.

The future of bank risk management

Among the key trends in risk management pointed out in McKinsey & Company’s latest report are the broadening and depth of regulatory scope, increased customer expectations with technological advancements, and the increased use of “big data” and machine learning for analytics.

The bizarre world of bitcoin ‘mining’ finds new home in Tibet

Hidden in the Tibetan highlands of western China rests a Bitcoin “mine,” the engine room of the international digital currency. The Washington Post has the full and fascinating story of the cryptocurrency underworld emerging into mainstream.

Banks’ new digital battlefront: the customer experience

Not giving customers the experience they expect could be impacting mainstream banking’s bottom line, industry insiders told American Banker. “They are not being shaped by peer-competitor banks. They are being shaped by Apple. They are being shaped by Google. They are being shaped by Amazon,” said Jim Smith, executive vice president of virtual channels at Wells Fargo.