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POST Well, yes, banks are technology companies

The “meme” that banks are, essentially, a special kind of technology company (special because they are granted special privileges that other companies do not have, such as the ability to create money) is common.

Here's what Christian Edelmann and Patrick Hunt said in the Harvard Business Review: "Technology specialists will play a greater role in allocating investments, working alongside senior management from a more traditional background". From my early experiences as an advisors to boards, I can see the dynamics at work here. To pick an obvious topic, some financial organisations' early response to open banking was to see Application Programming Interfaces (APIs) as something to do with technology and therefore not strategic. This left them on the back as

 

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Instead, du Toit predicts, banks will partner with Amazon and others. Lenders would manufacture financial products, and tech giants would serve as distribution and servicing channels. In other words, what Amazon already does with consumer goods.

Yet because distribution accounts for two-thirds of banking profits, according to a McKinsey & Co. report, banks may not love being relegated to mere factories for mortgages and credit cards.

From Consumers Want Tech Firms to Take On the Banks - Bloomberg

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And because Amazon wouldn’t have to pay to lure customers -- it already has millions of them -- it could afford to set up digital accounts without “all the nuisance fees and relatively high minimum balances” that lenders impose

From Consumers Want Tech Firms to Take On the Banks - Bloomberg

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