Banks urged to embrace disruption

In a crowded seminar at the Global Corporate Venturing Symposium, Property Partner CEO Daniel Gandesha, Jaidev Shergill, head of digital for Capital One Financial Services, and Egbert Bierman, of Aegon’s Transamerica Ventures, discussed the future of banking.

Banks are currently being threatened by the disintermediation of outside companies pushing into the space between consumers and banks, with companies such as Square or Stripe taking over tasks that traditionally were controlled by banks.

An important aspect of banking is lending and that is also currently being disrupted by startups that focus on peer-to-peer (P2P) lending, or lending to small and medium-sized enterprises (SMEs).

While P2P disruptive technology has not been adopted by any banks yet, SME lending has – but banks are not good at fringe lending, and more often than not SMEs will see their application denied.

The panel also pointed out that if a technology is disruptive, it is always better to sit at the table rather than fight the innovation. To sell this to management, it pays to spin it not as a disruption but as an opportunity.