Are banks going to die?

Last week, we posted a few thoughts on how fast the banks are really going. Over the past week, it seems my newsfeed has been flooded with predictions on the life of the bank as we know it.

And the predictions are all over the place.

The ‘Banks Will Die (Unless They…)’ School

  • McKinsey just released a report on the short-term future of banks, and sees them with the choice “between taking on new entrants through smarter use of their vast data resources and transforming their brands, or by forging alliances with startups”.

“Banks must decide soon, probably within three years, or the choice will be made for them.”

“We need perspective on how to muster the personnel to monitor, assess and adjust our digital marketing programs and make sure they are compliant with regulatory standards. Community banks need information like this to keep their doors open.”

“Banks need to start thinking and working like technology companies, and use innovative thinking and big data to better understand their customers.”

The ‘Banks Will Survive’ School

“Even in the 21st century, bank branches continue to provide vital services, typically ones that are much harder to give via the internet or over the phone.”

“The reality of the banking industry in the US, however, is that there is no startup truly pursuing a full stack strategy. As a result, dire warnings that banks will go by the wayside are totally ridiculous (the US government is way more of a threat to banks than any fintech startup is).”

“The ability to offer financial products and services in real time globally at reduced costs could actually catapult traditional banks back to top spot in the race to devise financial innovations.”

“In this age of the empowered customer, those banks which embrace the latest digital strategies will ultimately be the ones who deliver most benefits to their account holders, reaping the benefits of their investments.”

“But the key issue here is the payment system. Because they control it, banks enjoy their greatest hold over consumers, and also their privileged position with politicians and regulators.”

A summary? Banks might not die, but they’ve got a lot of work to do.

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Kate is CCO of untapt and Founder of FactorZero. A marketer by trade, she's had varied roles as President of Girls in Tech, Founder of Other Side Group, Executive Director of Digital and Social Media at Syracuse University, and has been in and around startups her entire career. She writes for a bunch of places including Forbes and Entrepreneur, and dabbles (a lot) in women in technology and entrepreneurship stuff, startup stuff, good craft beer, hard cider and hops farming, skiing, hiking and playing music.