Is Your Banking Job Gone Soon?


Fintech is steaming ahead at an incredible pace. What robots used to be for the automotive industry, algorithms have become to the banking industry.

Common wisdom had it that one’s job would be secure if one was well educated and kept up-to-date on the job. Now, however, we are increasingly facing a situation when even highly sophisticated occupations such as personal finance advisors as well as accountants and auditors will fall prey to digitalization.

The Future of Employment

In their 2013 study “The Future of Employment” Karl Benedikt Frey and Michael Osborne estimated the probability of computerization for 702 professions based on three factors: perception and manipulation tasks, creative intelligence tasks and social intelligence tasks.

Applied to Banking

Of those occupations examined by Frey and Osborne I have extracted those that I find relevant to the banking industry. The percentage figure displayed indicates the likelihood of that profession being computerized in “a decade or two”, i.e. between 2023 and 2033.

Occupation: Probability of Computerization

Sec., Commod., and Fin. Services Sales Agents: 1.6%
Financial Managers: 6.9%
Management Analysts: 13.0%
General and Operations Managers: 16.0%
Financial Analysts: 23.0%
Business Operations Specialists, All Other: 23.0%
Managers, All Other: 25.0%
Financial Specialists, All Other: 33.0%
Economists: 43.0%
Customer Service Representatives: 55.0%
Personal Financial Advisors: 58.0%
Administrative Services Managers: 73.0%
Loan Interviewers and Clerks: 92.0%
Accountants and Auditors: 94.0%
Credit Authorizers, Checkers, and Clerks: 97.0%
Tellers: 98.0%
Loan Officers: 98.0%
Credit Analysts: 98.0%
Brokerage Clerks: 98.0%
Bookkeeping, Accounting, and Auditing Clerks: 98.0%
New Accounts Clerks: 99.0%
Data Entry Keyers: 99.0%

Source: Frey, C. B., & Osborne, M. A. (2013). The future of employment. Oxford, UK: Oxford Martin Programme on Technology and Employment.

Dr. Patrick Schüffel, A.Dip.C., M.I.B., Dipl.-Kfm.
Institute of Finance
Haute école de gestion Fribourg
Chemin du Musée 4
CH-1700 Fribourg,

Your New Trading Screen – In A Not So Distant Future


Open APIs and Gamification will revolutionize the look and feel of trading screens. This will happen sooner than you think.

For several years I had my desk on the twelfth floor of “Uetlihof” in Zurich or on Credit Suisse’s trading floor as non-locals call it. It was an exciting surrounding with traders sitting behind walls of six, eight, or even nine LCD screens and executing trades from early to late shift. During the day they went about their business, namely securities or FX trading. At night, however, many of the folks on that floor shared a different passion: they played the multiplayer online video game World of Warcraft. For that purpose some of my colleagues had even erected walls of LCD screens at home in order to indulge in this pastime. The mornings in the office often started with stories from last night’s adventures in the virtual world, most of the time even bevor the official morning brief.

I came to wonder what these colleagues were essentially doing during working hours and off hours. Wasn’t it sort of identical? To put it at its simplest, during working hours they were receiving information from their screens – most of which came from Bloomberg – they were processing this information in their brains and then they were acting upon it by executing orders or parts thereof or simply waiting. For taking action they used the Bloomberg provided user interface. At night they were sitting in front of their World of Warcraft screens which were displaying information provided by Blizzard Entertainment they were processing this information in their heads and then they were acting on it accordingly either by slaying a monster, injuring it or by avoiding it. To take action they used the Blizzard Entertainment provided graphical user interface (GUI).

The commonalities are striking, I thought. But here comes the major difference: during the day they were paid handsomely for their “work” by their employer. At night, however, they ran up quite some bills which they owed to Blizzard Entertainment for “playing”. In other words, for the people concerned similar actions resulted in an income during day and caused a cash outflow at night. So what justified this difference? What sets apart a Bloomberg screen from a World of Warcraft game from the user ‘s point of view? I figured it was nothing but the fun factor. Working with a Bloomberg screen was seen as work whilst playing World of Warcraft created joy. For a long time I pondered the question when someone would create a trading GUI of a World of Warcraft design and an underlying logic that would reflect the World of Warcraft narrative. I am convinced that this time is about to come. This is due to two trends: Gamification and Open APIs


According to Wikipedia “Gamification is the application of game-design elements and game principles in non-game contexts”. Furthermore Wikipedia tells us that Gamification regularly employs game design elements which are used in so called non-game contexts. By doing so it strives to improve user engagement and organizational productivity and ease of use among others. Highly successful business applications for Gamification can be found in as diverse areas as education (Kaplan University is boosting student grades by incorporating badges and challenges), recruiting (The U.S. Army is not only offering video games, but also deploying four transportable “Virtual Army Experience” units to shopping malls and attract new recruits and generally promote awareness of the U.S. Army), and personal training (Jillian Michaels motivates her clients to stay on track with her fitness programs by using gamification methods for a variety of fitness contests). But gamification has also made its way into the world of Finance., for instance, makes the rather cumbersome process of financial planning and book keeping more enjoyable by providing a range of goal trackers, visual breakdowns for better understanding of your spending habits and budget allocation etc. And I am convinced that we will see further applications in the world of Finance due to another trend: Open APIs.

Open APIs

Consulting Wikipedia once more, it tells us that an Open API is “a publicly available application programming interface that provides developers with programmatic access to a proprietary software application”. The attribute “open” results from the fact that “an open API is publicly available for all developers to access”. It thus permits developers who are not part of an organization’s workforce to access backend data upon which these developers can build their own applications. Famous APIs in the business world are geo location APIs which can be used to provide a use with his or her geographic location, search engine APIs which allows developers to integrate search logic into own products or services, or postcode APIs that provide end clients with correct postal codes etc. As the API is simply used to fetch backend information from the system of backend-owner, resp. the API publisher has no control over the end product that will we be built around this data. Hence, once a set of skilled developers have access to the backend trading data of a broker firm nothing could keep them from creating a trading GUI that resembles a video game.

Many online brokers around the world already offer adequate APIs for such an undertaking. In Switzerland Interactive Brokers, Swissquote, IG Bank, and also Saxo Bank provide this type of interface, just to name a few. Seeing the activities that are emerging around APIs and the increased transparency that is provided by banks, I am convinced that rather sooner than later we will see a trading screen that much more resembles a video game than a newspaper page. Whether this video game will then be of World of Warcraft-type or rather similar to an Atari version of Space Invaders, remains to be seen.

What will further happen if you directly connect human brains to computers to play the game or when you task AI algorithms to operate the gaming interface, is sufficient material for additional articles. In any case, the process of gamifying the finance industry in general and trading screens in particular promises yet another multimillion, if not billion, business opportunity for video game makers, trading system providers and Fintechs alike.


Dr. Patrick Schüffel, A.Dip.C., M.I.B., Dipl.-Kfm.
Institute of Finance
Haute école de gestion Fribourg
Chemin du Musée 4
CH-1700 Fribourg,


Is Academia Ignoring Fintech?

Three MonkeysCurrently the Annual Academy of Management (AoM) Meeting is taking place in Anaheim, California. Some 10’000 Management scholars from 88 countries are meeting to discuss the current affairs of Management and its outlooks. In more than 2’500 sessions topics are discussed from the disciplines of Entrepreneurship, Technology and Innovation Management, Organization Development and Change, and Operations Management, just to name a few. The meeting program spans a whopping 608 pages and contains literally hundreds of thousands of words. Yet one word is missing: FINTECH!

Already today more than three dozen Fintech unicorns exist, most of which are not even five years of age. Moreover we are witnessing the appearance of novel Fintech companies almost on a daily basis. This development has caught the attention of business people, regulators and politicians alike. Yet, this development has largely gone unnoticed by the academic world as far as management sciences are concerned. Clearly, there are noteworthy exceptions from this rule, but at large Fintech is simply not existing in this academic setting.

This situation gives rise to several questions. For instance, how do we educate Management students for today’s banking and finance world if the Fintech phenomenon remains untouched? How do we train executives? How does academia intend to give sound advice to policy makers in view of this neglect? If the ultimate purpose of science – among others – is to explain, control and predict, academia must swing into action and intensify its efforts in the field of Fintech.

I therefore also strongly welcome efforts such as the ones by Thomas Puschmann of the University of Zurich who is actively building a bridge between the practical Fintech world and academia by establishing the “Swiss Fintech Innovations” association as a port of call for practice and academia alike.

In Luxembourg Anne-Laure Mention is one of the commendable academics at CRP Henri Tudor who attempts to narrow the gulf between innovation in financial services in practice and academia.

If there are other such initiatives in other countries, please do drop me line! I am keen to learn!

Dr. Patrick Schüffel, A.Dip.C., M.I.B., Dipl.-Kfm.
Haute école de gestion Fribourg
Institute of Finance
Chemin du Musée 4
CH-1700 Fribourg,

What is Fintech? [Attempting] A Definition

What_is_Fintech_A_DefinitionIncreasingly often I am being asked by students, colleagues, investors, even friends and family “What is Fintech?”. I then typically answer “Fintech is an industry made up of organizations using novel financial technology to support or enable financial services”. And then, to avoid misunderstandings I add “A Fintech is an organization that uses novel financial technology to support or enable financial services”.

Yet, what sounds like a pretty straight-forward answer, was a hard nut to crack. In fact, the term Fintech is so often and widely used that some people even increasingly shun using it altogether.* To them the concept of Fintech has become too comprehensive and too ubiquitous to have any conclusive meaning any longer. For me it required quite a thought process to come up with a telling definition. This is due to several reasons.

Definitions are never true or false

First, a definition is never true or false per se, but more or less useful in a specific context. For instance, think about the term “power”. How would a physicist define it? How a politician? Which definition would a judge provide? Which explanation would an athlete give? Moreover, even within the domain of sports you are likely to receive different answers, depending on whom you ask. A weight lifter will most probably provide you with a different answer is than the fellow athlete from the same Olympic team who competes in synchronized swimming. Hence, we have to accept that – contingent on the counterparty you ask – one may well receive varying answers on the identical question. The same applies to the expression Fintech.

Looking at the most popular encyclopaedia of our times, Wikipedia, we can read that “[f]inancial technology, also known as fintech, is an economic industry composed of companies that use technology to make financial services more efficient.” (Wikipedia, 2016a). Conveniently enough for the reader, Wikipedia also provides us with the source for their definition. Wikipedia refers to the Wharton FinTech Club which provided this definition (Wharton Fintech, 2014). In a similar vein Susanne Chishti and Janos Barberis state in their landmark book on Fintechs that “Financial Technology or FinTech is one of the most promising industries in 2016” (Chishti & Barberis, 2016, p.5). The Oxford Dictionary tells us that Fintech is a mass noun (Oxford English Dictionary, 2016). More specifically this most authoritative source for British English suggests that Fintech are “Computer programs and other technology used to support or enable banking and financial services: fintech is one of the fastest-growing areas for venture capitalists”. In this context it may also be noteworthy that the most widely used dictionary and thesaurus for American English, Merriam-Webster, does not offer any definition for the term (Merriam-Webster, 2016).

On one popular Web sites in the Fintech sphere one can find the following definition “Fintech is a line of business based on using software to provide financial services.” (Fintech Weekly, 2016). Interestingly enough on that very Website reference is made to Wikipedia which – at least today – provides a different definition. On another blog from the finance world one can read a definition provided by Harry Wilson of Claro Partners: ”FinTech is an ecosystem of startups” (Wilson, 2015).

We could almost indefinitely continue this exercise of extracting definitions for the term Fintech from various authors. Yet, already from this very short although not representative selection of definitions, we can conclude that there is a vast range of meanings of the word Fintech: from “computer programs” and “other technologies” over “line of business” and “ecosystem” to an “industry”. This plethora of connotations makes it hard, if not impossible, to distil one commonly accepted explanation.

Interestingly enough even some of the biggest consultancies which certainly employ some of the smartest minds on the planet shy away from defining the term Fintech. Regularly one can find reports on Fintech related topics which do not provide any definition of the term Fintech itself; see for instance the McKinsey report on the effects of Fintech on banks by Dietz, Khanna, Olanrewaju & Rajgopal (2015) or the BCG report on the opportunities Fintech provides to corporate banks by Dany, Goyal, Schwarz, Berg, Scortecci & Baben (2016).

Definitions change over time

The second reason, why it is so inherently difficult to define the concept of Fintech is because definitions change over time. Also here we have some analogies. As an illustration think about the expression “information technology” (IT). In the early days of computing IT stood for items such punched tapes and cathode ray tubes. Today, however, we much rather associate things such as Motion User Interfaces, Bots and the Internet of Things with IT. Consequently, it is also safe to assume that the expression Fintech undergoes change. The definition provided by Investopedia pays tribute to this fact: “Fintech is a portmanteau of financial technology that describes an emerging financial services sector in the 21st century. Originally, the term applied to technology applied to the back-end of established consumer and trade financial institutions. Since the end of the first decade of the 21st century, the term has expanded to include any technological innovation in the financial sector, including innovations in financial literacy and education, retail banking, investment and even crypto-currencies like bitcoin.”  So, for the authors of Investopedia, Fintech was originally an expression describing banking backend technology, but widened over time to also encompass technological innovations in financial services and related areas (Investopedia, 2016). Following the authors of Investopedia Fintech is not just a mere industry, but also a technology and an expression for innovation.

The big difference of a small article

So far we have been talking about “Fintech” – without prefixed article. However, during conversations, but also in texts one also regularly encounters the expression “a Fintech”. Is there a difference between “Fintech” and “a Fintech”? If so, what is the difference? To my experience people typically refer to a Fintech company or more specifically to a Fintech start-up when they talk about “a Fintech”. Hence, the difference is the “level of analysis” as the scientist would say. As explained above “Fintech” without article typically relates to an entire a group of objects whereas “a Fintech” is just one single entity. This apparently small difference by the prefix “a”, can give rise to serious misunderstandings. To a politician, for instance, it will make a world of difference, whether he or she is asked to support creating an industry cluster or even entire industry or just one single firm. The same goes for a venture capitalist albeit with opposite signs.

Definitions vary across languages

Fourth and last, confusion about the term Fintech emerges from the fact that definitions can vary across languages. To illustrate this fact, I recommend to take a look at the various definitions of Fintech provided by different language versions of Wikipedia. The Italian site, for instance, states that Fintech is the “provision” of financial products and services using information technologies [“La tecnofinanza, o tecnologia finanziaria (in inglese Financial Technology o FinTech) è la fornitura di servizi e prodotti finanziari attraverso le più avanzate tecnologie dell’informazione (TIC)”] (Wikipedia, 2016b).

By contrast, the German Wikipedia definition of Fintech suggests that Fintech is an umbrella term for “modern technologies in the area of financial services” [“Finanztechnologie (auch verkürzt zu Fintech bzw. FinTech) ist ein Sammelbegriff für moderne Technologien im Bereich der Finanzdienstleistu ngen”] (Wikipedia, 2016c).

The French Wikipedia version is much closer to the English one, yet it does not define Fintech as an industry, but more loosely as an “area of activity” [“La technologie financière, ou FinTech, est un domaine d’activité dans lequel les entreprises utilisent les technologies de l’information et de la communication pour livrer des services financiers de façon plus efficace et moins couteuse”] (Wikipedia, 2016d).

Hence, just by comparing across languages one can already fathom the potential for misunderstandings. While the Frenchman may be talking about Fintech as a business segment, the German may be speaking about technologies, the Italian about a delivery channel and the native English speaker may refer to an entire industry. Being aware of potential pitfalls is all the more important as the term Fintech is derived from the English words Financial Technology and also used as such in various other languages. Thus people may automatically assume that they talk about identical things whilst they are not. In addition one should bear in mind that Fintech is a global phenomenon. Running into questions of semantics across languages may happen easier than anticipated.

Coping with ambiguity

However, we can live with this ambiguity in definitions. In fact we have been living with this ambiguity for years, if not decades, in other fields of business and academia. For example, think about the term “strategy”, “innovation” or “business model”. We use them on a daily basis, yet we have not established one common definition for any of them. Hence, having not one single definition for the word Fintech has not and should not prevent us from using it. However, when talking about Fintech we should make clear to our audience what we mean by Fintech. Providing a little explanation for our audience may therefore significantly improve the efficiency of communication and reduce the potential for misunderstandings. If you want to be extra polite you may also want to explain to your vis-à-vis why you use one specific definition and not another.

Once more I want to stress that none of the definitions provided above are right or wrong as such. Rather than that they are more or less useful in certain contexts. The definition I provided above, “Fintech is an industry made up of organizations using novel financial technology to support or enable financial services”, is very similar to the one provided by the Wharton Fintech Club and which is being promoted by the English Wikipedia site. Yet, I prefer to use the more broadly defined word organization instead of company. Companies are typically profit seeking and hierarchically organized. More and more often, however, we see non-hierarchical organizations such as The DAO to play a major role in the Fintech domain (The DAO, 2016). I purposely want to include these organizations in my definition. What is more, I tightened my definition in comparison to the Wharton definition by extending it for the word “novel”. I did this because otherwise the more comprehensive Wharton definition would also include just any incumbent bank running on Cobol-coded host systems as they are using this (admittedly ancient) technology to be more efficient. Lastly, I added the verb enable to my definition of Fintech as I am convinced that Fintech is not just about enhancing efficiency, but also more fundamentally about enablement. The distributed ledger rendered possible by Blockchain technology or micropayments made available through telecommunication systems are just examples for theses empowering technologies. Attention should be paid to the fact that innovation emanating from Fintech can be anything from purely complementary to highly disruptive. If the innovation is barely supporting an existing business model in financial services it is likely to be complementary, whereas it will receive the label disruptive if it jeopardizes existing business models.

I am well aware of the fact that the definition I use is far from perfect. For instance, it does not provide definitions for its components. Hence, one could rightly ask, “So what do you specifically mean by  ’industry’ and what by ’novel’”? And how do you delineate ’industry’ from ’ecosystem’?”. Moreover I am certain that also the definition I use nowadays will change over time with the advancement of technology and the evolution of business. Last but not least, there are many terms up and coming that constitute for spin-offs of the overall Fintech theme. Among those are “InsurTech”, “WealthTech”, “RegTech”, just to name a few. Time will show how are they will be used.

Nicolas Steiner, one of the founding members of Level39 recently shared an anecdote about a meeting with a couple of French speaking experts from the telecommunication industry who asked him whether Fintech stood for “the end of technology”. The reasoning for that being that they believed that Fintech was short for the French expression “la fin de la technologie”. I hope by providing and spreading sense making definitions of Fintech we will encounter less and less of such misunderstandings in the future.

Spiros Margaris, who is often referred to as one of the Key Influencers of Fintech scene, once stated “Fintech will never disappear, only some fintech startups will disappear.” No matter which definition was used here, it is almost safe to say that this statement will come true.

*At this point greetings go out to Nasir Zubairi who is considered to be one of the big Fintech minds of Luxembourg


Chishti, S., & Barberis, J. (2016). The FinTech Book: The Financial Technology Handbook for Investors, Entrepreneurs and Visionaries. Chichester, UK: John Wiley & Sons Ltd

Dany, O., Goyal, R., Schwarz, J., Berg, P. v. d., Scortecci, A., & Baben, S. t. (2016). Fintechs may be corporate banks’ best “Frenemies”.

Dietz, M., Khanna, S., Olanrewaju, T., & Rajgopal, K. (2015). Cutting through the FinTech noise: Markers of success, imperatives for banks. In G. B. Practice (Ed.): McKinsey & Company,.

Fintech Weekly. (2016). Fintech Definition.   Retrieved from

Investopedia. (2016). Fintech.   Retrieved from

Merriam-Webster. (2016). fintech.

Oxford English Dictionary. (2016). fintech.   Retrieved from

The DAO. (2016). Overview.   Retrieved from

Wharton Fintech. (2014). What is FinTech?   Retrieved from

Wikipedia. (2016a). Financial Technology.   Retrieved from

Wikipedia. (2016b). Tecnofinanza.   Retrieved from

Wikipedia. (2016c). Finanztechnologie.   Retrieved from

Wikipedia. (2016d). Technologie financière.   Retrieved from

Wilson, H. (2015). The new shape of FinTech is making the world a better place.   Retrieved from

Professor Dr. Patrick Schüffel

Haute école de gestion Fribourg
Institute of Finance
Chemin du Musée 4
CH-1700 Fribourg

[posted on LinkedIn on July 20th]


Doing Away with an Urban Myth

Banking is necessary Banks are not

Who truly coined the phrase “Banking is necessary. Banks are not.”

Personally, I give Bill Gates credit for many a thing. Without his technology vision and his business acumen our daily lives would look totally different today. Yet, despite many sources on the Web claiming so, I give him no longer credit for the statement “Banking is necessary. Banks are not.”. After some tedious research on the Internet as well as in literature data bases the most convincing source of this quote became for me the former chairman and CEO of Wells Fargo, Mr. Richard M. Kovacevich. See Nocera, Joseph (1998): Banking is necessary-Banks are not. Fortune. May 11th, Vol. 137, Issue 9, p.84.

However, should you have any hard evidence proving the opposite, please do drop me a comment. Thanks!

Dr. Patrick Schüffel, A.Dip.C., M.I.B., Dipl.-Kfm.
Adjunct Professsor
Haute école de gestion Fribourg
Chemin du Musée 4
CH-1700 Fribourg

Reflection Time: Innovation in Banking

What hampers Innovation in your bank


Innovating is intrinsically difficult. Coming up with an idea for a new service or product is just the mere beginning of what oftentimes turns out to be an extremely cumbersome journey. Moreover, the banking industry in particular is not especially innovation friendly. Being aware of obstacles on the road can help to clear those hurdles. So, whenever you enter on an innovation journey, spend a few minutes thinking of potential causes for troubles.

Dr. Patrick Schüffel, A.Dip.C., M.I.B., Dipl.-Kfm.
Adjunct Professsor
Haute école de gestion Fribourg
Chemin du Musée 4
CH-1700 Fribourg


What would happen if Google was to found a “Google Bank”?

GoogleBankWhy it could be worthwhile to look at the banking world over the rim of one’s tea-cup

Most likely the music industry would have never dreamt of Apple becoming their biggest competitor. In a similar vein established mail order businesses had never imagined that the auction house Ebay and the book store Amazon would suddenly pull the rug from under their feet. And the camera manufacturers of this world carefully watched each other’s every move but obviously lost sight of the digital competition. For Kodak this ended deadly.

But how about today’s banks? What would happen if an industry outsider would enter the banking industry and would pose a serious competition for the established players?  For instance, what would happen if Google would decide to setup a bank?

First of all it should be noted that the necessary cash is available. With approximately 60 billion US Dollar Google has a pile of cash at its disposal that is waiting to be assigned to a specified use. The entry hurdle cash is thus negligible. One could even go as far to say that Google could easily absorb a total write-off in case the banking venture should fail.

Moreover, cost advantages may arise through the technology leadership that Google possesses. Incumbent banks regularly struggle with IT legacy systems that had often been built in the eighties of the previous century. These core banking systems had not only been developed in programming languages which are hardly known these days any longer, but they are based on a process oriented approach which is antiquated given today’s object oriented program codes. Merely keeping those systems alive already eats up a fair share of the entire IT budget of many banks. Google would not have these legacy problems. Google could build a new bank based on the latest IT technology on a green field or – to be more precise – in a green cloud.

But does Google have the necessary reputation to do banking? Conventional wisdom has it that banks should be serious, conservative, maybe even a little bit outmoded. At first glance this notion does not sit well with a playful service provider whose corporate identity was coined by the colours of Lego bricks and that grew large in the Internet. At closer inspection, however, one can observe that already today clients entrust Google with almost any information. The trust in Google appears to be boundless as far was data is concerned. Why should that be different in money matters? 

But what about Google’s potential clients? Who would entrust a Google Bank with his or her money? In this context it must be noted that as of today Google has already more than 400 million clients with user accounts that source various products and services from Google, from email accounts over translation or navigation services to hardware such as the Google tablet. The list is almost open-ended. If only a fraction of these clients would become clients of a Google Bank it would mean millions.

To put it at its simplest the business model of Google consists of collecting, condensing and editing data in a user-friendly fashion. Google has honed this model to perfection. Should Google now decide to offer banking services we could also expect to see this type of sophistication in banking. As an extreme case Google could for example scan the mail box of a client (as is already happening today). If there are any indications that the client may want to purchase a house, Google could proactively offer a mortgage to this client. Google has the potential to reveal client needs and to make corresponding offers even before the client is clear on his or her need himself or herself.

Last but not least Google has an outstanding reputation as an employer. When it comes to winning employees for a new Google Bank, Google could easily keep up with incumbent banks – at least as far as the under 35 year olds are concerned. As the banking industry’s neophyte Google could differentiate itself from the alleged causers of the financial crisis. It is safe to assume that Google could fight the war for talent from a vantage point.  

If the preconditions are so favorable for Google why has Google then not long entered the banking industry? A plausible explanation could be that Google still considers the banking sector as too unattractive. But this could change soon as Google has already made first steps towards banking with the Google Wallet and by obtaining a license as an Electronic Money Institution. This leaves incumbent banks with two options in the meantime: one could be entering a partnership with Google and forming an alliance with the technology giant. The second option would be to swiftly whip finances into shape, to polish up the image of the bank, to increase the customer base, to improve client service and to enhance the relationship with the employees – quite simply to be geared to Google in these matters.

Hence, when looking at the own position in the banking industry, it could be worthwhile to get one’s bearings not solely by looking at the other competitors in the banking business. Looking at the banking world over the rim of one’s tea-cup could thus be a valuable exercise.


Note from the author:

This is the English translation of a German post that was published on the Swiss financial blog ‘Inside Paradeplatz’ on 04 March 2015. Due to numerous feedback on the German post, manifold requests of non-German speakers to translate the text, but also due to the fact that I attended some utmost inspiring presentations by Patrick Warnking and Sandra Emme of Google Switzerland in the meantime, I decided to also publish the English version of this post.


Dr. Patrick Schüffel, A.Dip.C., M.I.B., Dipl.-Kfm.
Adjunct Professsor
Haute école de gestion Fribourg
Chemin du Musée 4
CH-1700 Fribourg,

Luxembourg is on a FinTech Journey

PwC Press Release, 21 April 2016

According to the PwC Luxembourg Report, the Grand Duchy is an emerging FinTech innovation hub

FinTech, a game-changing alloy of technology and finance, blends innovation-focused technology companies with traditional financial sector players. The merger of these two different business approaches, the tech and the traditional one, is the bedrock of the future financial sector landscape. Luxembourg, with its modern financial institutions, is well positioned to take reigns of the FinTech revolution.

Adapting to change: rising FinTech awareness in Luxembourg

With its vibrant ecosystem of financial institutions, technology companies, R&D centres, and a highly diversified and specialised economy, Luxembourg is an emerging FinTech innovation hub. “The country already provides factual support to innovation by encouraging private and public funding, and by building up a true start-up support ecosystem: the government put FinTech as one of the six key domains of the Digital Lëtzebuerg Strategy launched in 2014, aimed at turning Luxembourg into a digital nation, and mandated Jeremy Rifkin to examine and advise on how the Grand Duchy can leverage its FinTech potential” says Gregory Weber, FinTech Leader at PwC Luxembourg.

The Grand Duchy provides an attractive ecosystem not only for FinTech companies, but for business in general. Adding its innovative and responsive regulatory environment, Luxembourg is the epitome of a FinTech aware business environment. Local market players seem to perfectly understand that by embracing the FinTech business model, the Grand Duchy is on the right path to further strengthen its recognition and reputation among investors, clients and the start-up community.

Internet, mobility, social networking and the rise of price comparison websites have changed the game over the past decade and have created a new generation of customers who demand simplicity, speed and convenience in their interactions with financial providers and even with their peers” highlights Gregory Weber. Traditional market players have started adapting to new market demands. The need to meet changing customer expectations with new offerings (resulting in an increased focus on the client experience) is top-of-mind for 86% of Luxembourg respondents when asked about the most important impact of FinTech on their business.

Business at risk: 26% of the traditional financial sector in Luxembourg may be lost to FinTechs

According to the survey, nearly all (94%) respondents from the traditional financial industry believe that part of their business is at risk of being lost to standalone FinTech companies. Incumbents believe that more than a fourth part (26%) of their business could be at risk due to further development of FinTech, though FinTech companies anticipate that they will be able to take over only 10% of incumbents’ business (compared to 33% globally). “In this regard, the asset & wealth management industry is feeling particular pressure from FinTech companies” adds Gregory Weber.

On the other hand, insurers in Luxembourg may be underestimating the threat posed by FinTech with an estimated share of business at risk of only 10%, compared to 21% for global insurance participants.

However, not only are traditional financial industry providers concerned about losing part of their business to FinTechs, they are also aware that their ways of working and product offerings will be challenged and possibly transformed.

Blockchain: high on the agenda in Luxembourg, but still underexplored

Blockchain represents the next evolutionary jump in business process optimization technology. If blockchain gains wider acceptance, it could lead to significant changes in back-office roles, as ownership could be transferred without the need for intermediaries and reconciliations would disappear once there is a shared ledger that all parties agree on. “In Luxembourg, the majority of respondents (60%) recognises blockchain’s importance and is much more willing to respond to blockchain when compared to global respondents (except for asset & wealth managers). However, none of the respondents declares being extremely familiar with the technology. Only 17% believes being very familiar with it while one in five Luxembourg industry players is not familiar with blockchain at all” highlights Gregory Weber.

The ability to collaborate, at both a strategic and business level, with a few key partners could soon become a competitive advantage of Luxembourg financial industry.

How is the Luxembourg financial sector dealing with FinTechs?

Almost half (44%) of Luxembourg financial sector players believes that FinTech is integrated at the heart of their corporate strategies. However, more than 50% either does not have a fully aligned corporate FinTech strategy or FinTech does not have any role or impact within the strategic corporate agenda.  There is no clear industry-wide trend in terms of how traditional players deal and engage with FinTechs. More than a third (34%) engages in joint partnerships with FinTech companies, 31% buys and sell services to FinTech companies, 14% rebrands purchased FinTech services (white-labelling), 14% launches their own FinTech subsidiaries, one in ten establishes start-up programs to incubate FinTech companies and 7% sets up venture funds to fund FinTech companies. Surprisingly, 21% of Luxembourg participants does not deal with FinTech at all. When both parties (traditional financial and FinTech companies) are asked about the biggest impediments when dealing with one another, incumbents name regulatory uncertainty (68%), IT security (45%) and differences in operational processes (45%). FinTechs, on the other hand, are mostly concerned about different management culture when dealing with incumbents (67% of respondents) and IT security (50%) is also a concern.

While the responses from Luxembourg participants are generally aligned with the global ones, the required financial investments for Luxembourg FinTechs when dealing with traditional financial companies (50%) clearly stand out. Globally, this issue is FinTechs’ smallest concern, raised only by 28% of survey participants.

FinTech is re-shaping the financial sector at such a pace that those players that stay behind today might not even recognise the sector in five years. With their potential, Luxembourg players, however, have all the capabilities to stay at the heart of the FinTech revolution. The golden rule: start embracing FinTech now” concludes Gregory Weber.


Legend:Gregory Weber, FinTech Leader PwC Luxembourg – Nicolas Mackel, CEO Luxembourg for Finance – Jonathan Prince, Co-Founder Digicash Payments SA – Romain Godard, Partner PwC Strategy& – Patrick Schüffel, COO, Saxo Bank AG – Nasir Zubairi, Entrepreneur/Investor

Notes to Editors:

About the report :

The 2016 PwC Global FinTech Survey gathers the view of 544 respondents from 46 countries, principally Chief Executive Officers (CEOs), Heads of Innovation, Chief Information Officers (CIOs) and top management involved in digital and technological transformation, distributed among five regions.

The Luxembourg-focused cut was based on the responses of 36 respondents from the financial industry’s major market players.

For a copy of the report and to see the full results, please visit

Innovationskultur: Scheitern inbegriffen


vom 18.11.2015, von Madeleine Stäubli-Roduner


Bei tiefgreifenden Innovationen agieren viele Finanz­institute zögerlich. Sie könnten ein viel grösseres Potenzial ausschöpfen. Dafür müssen sie Innovationskultur von oben gezielt fördern und Impulse von aussen einbeziehen.

So funktioniert ein direktes Finanzierungssystem mit starker Kundenanbindung zu beiderseitigem Nutzen: Die US-amerikanische Firma Loyal3 bietet ihren Kunden an, Aktien von favorisierten Unternehmen unbürokratisch auf Facebook zu erwerben. Die Kosten sind drei Klicks. Während sich die «Liker» einen Dauerauftrag für den monatlichen Aktienkauf einrichten können, bringen verkaufswillige Unternehmen ihre Apps direkt auf ihrer Facebook-Site an. Diese verblüffende Idee wurde nicht in einem Finanzinstitut geboren.

Mit den dynamischen Fintech-Firmen können Banken im Kreativi­täts-Ranking kaum mithalten. Zwar an­erkennen Finanzinstitute, dass In­no­vationen unverzichtbar sind, aber an ihren bewährten Strukturen wollen sie meist festhalten. Zu diesem Befund kommt eine Umfrage der Swisscom bei 22 Schweizer Banken. Die Gründe für Innovationsbarrieren sind zahlreich: Oft werden Projektaufträge nur vage beschrieben, sodass ein ungezielter Aktionismus entsteht. Lange Entscheidungswege bremsen die Innovationskraft. Angestammtes Silodenken, starre Hierarchien und finanzielle Anreizsysteme verunmöglichen, aktiv Veränderungsprozesse angehen und neue Strategien effizient umsetzen zu können. Banken müssten erst lernen, mit Offenheit umzugehen, sagt auch Patrick Schüffel, Adjunct Professor an der Hochschule für Wirtschaft Fribourg: «Das «not invented here»-Syndrom ist noch weit verbreitet und entstammt einer Zeit, als Banken tatsächlich einen signifikanten Informationsvorsprung gegenüber der Aus­senwelt besassen.» Die kompetitiven Vorteile seien in den letzten Jahren massiv geschrumpft.

Mitarbeiter sind extrem kreativ, wenn man sie nur lässt

Doch gerade in herausfordernden Rahmenbedingungen sei ein hohes Mass an Kreativität gefragt, betont Jens-Uwe Meyer, Innovationsexperte und Geschäftsführer der Innolytics in Leipzig. Kreativität bedeute aber nicht, besonders ausgefallene Ideen zu entwickeln. Vielmehr habe ein Erfinder wie Thomas Edison seine Erfindungen genau um bestehende Regularien herum entwickelt. Auch Marco Abele, Leiter Digital Private Banking bei der Credit Suisse, will Innovation weitreichender definieren. «Innovation entsteht oft gerade dann, wenn äussere Einflüsse einem aufzwingen, gewisse Prozesse oder Modelle zu überdenken. Innovation ist insofern nichts anderes als die Lösung eines Problems.» Ob es nun um fortschreitende Digitalisierung, veränderte Kundenbedürfnisse, regulatorische Anforderungen oder Kostenfragen gehe – das seien alles gute Gründe dafür, innovative Lösungen zu finden.

Für solche Lösungen fehlt es den Finanzinstituten laut Meyer keinesfalls an fähigen Mitarbeitern: So hätten die Mitarbeiter einer regionalen deutschen Volksbank in einer der ärmsten Regionen des Landes eine eigene Softwareplattform entwickelt. «Mitarbeiter im Bankenbereich sind extrem kreativ, wenn man sie nur lässt», sagt Meyer. Woran fehlt es denn, damit sich bahnbrechende Einfälle zu neuen Geschäftsmodellen entwickeln können Als zentrale Faktoren nennt Meyer die Führungskräfte: Sie sollten ihre Mitarbeiter ermutigen, neue Ideen zu entwerfen, auch solche, die unrealisierbar und daher als «kreative Kollateralschäden» zu verbuchen seien. Innovation müsse Chefsache sein. Es gebe zahlreiche wissenschaftliche Studien, die nachwiesen, dass Unternehmen, in denen sich die oberste Führungsebene persönlich für Innovation einsetze, deutlich innovativer seien. Entscheidend, so sagt auch Abele, sind der Mut, neue Wege zu gehen und ein Management, das Innovation vorlebt. «Innerhalb des Digital Private Banking fördern wir gezielt innovatives Denken und Handeln, und wir geben den Mitarbeitern auch entsprechende Freiräume, um Ideen anzudenken und umzusetzen.» Nach Ansicht von Dozent Schüffel muss das Management sogar bewusst das Risiko eingehen, dass eine Vielzahl von Innovationen scheitern wird.

Wichtige Impulse kommen in den meisten Fällen von aussen

Um spezifische Ideen zu evaluieren, veranstaltet die Credit Suisse etwa ein internes Innovations-Crowdsourcing. Ebenfalls wichtig sei der Austausch mit kreativen Leuten ausserhalb des Unternehmens, sagt Abele. Dies sei einer der Gründe dafür, dass sich die Credit Suisse am Impact Hub Zürich beteiligt habe. «Dort werden einige unserer Mitarbeiter regelmässig tätig sein, sich vernetzen und an Projekten mit Start-ups und anderen Partnern mitarbeiten.» Dabei gewinnen sie laut Abele Freiheit, Raum und Nahtstellen zu anderen innovativen Organisationen, wodurch Innovation entstehen könne. Auch Hochschullehrer Schüffel ortet grosses Potenzial ausserhalb der Institute. Sie könnten mit einem minimalen Mehraufwand ein wesentlich grösseres Reservoir von Ideen anzapfen, als dies jemals mit internen Innovationsinseln möglich sei. Die sogenannte «Open Innovation» sieht er als eine der effizientesten Methoden für Schweizer Banken. Mit dem Motto «Most smart people don’t work for this firm» werden Kunden mittels Internet-Plattformen in die Ideensuche einbezogen, denn der Kunde wisse, wo der Schuh drücke.

Schüffel hat mit einem Team die erste internationale Open-Innovation-Plattform für Finanzdienstleister entwickelt. Die Resonanz von Seiten der Schweizer Banken sei «bisher sehr zurückhaltend gewesen». Sie hätten wohl Interesse an der Plattform geäussert, jedoch keinerlei Projekte angestossen. Immerhin bauten grosse Bankinstitute immer öfter eigene Innovationsabteilungen auf und seien daher über die Thematik unterrichtet. Nun erwägt Schüffel, die Plattform im ersten Schritt nur firmenintern zu nutzen. «Wenn man bedenkt, dass Banken mitunter auch Tausende von Mitarbeitern in verschiedenen Ländern beschäftigen, könnte eine firmeninterne Verwendung ein grosser erster Schritt in Richtung Open Innovation sein.»

Solche Konzepte sind laut Meyer in vielen Banken noch nicht verbreitet, denn: «Die Angst, sich dem Kunden gegenüber zu öffnen, ist aktuell noch zu gross.» Ein Forschungsprojekt der Hochschule für Wirtschaft Fribourg ortet als hemmende Faktoren einen eklatanten Mangel an Wissen über Innovations-Management-Techniken und fehlende Offenheit für neues Wissen aus neuartigen Quellen. Entscheidungsträger in der Bankenbranche orientierten sich gerne an Peers und fühlten sich damit bestens informiert. «Dabei wird regelmässig übersehen, dass massgebliche Entwicklungen zunehmend ausserhalb der Bankenbranche stattfinden beziehungsweise im Fintech-Sektor», sagt Schüffel. Auch Abele ist überzeugt, dass Banken von Fintech- und Technologieunternehmen lernen könnten, etwa, wie sie ihre Prozesse strukturieren und schnell auf veränderte Bedürfnisse reagieren könnten. «Wir erachten es deshalb für wichtig, auch als Grossbank nah an der Fintech-Szene dran zu sein», so Abele. Letztlich aber könne auch eine innovationsförderliche Kultur nur dann funktionieren, wenn die Führungsetage diese selbst vorlebe.