04 August 2017

Transforming banking with fintech

More inspiring ideas from Business Insight Centre

Technologies, such as fibre optic cables for fast internet access, have transformed many industries.

Andy Maguire is the Group Chief Operating Officer, HSBC. He discusses how the bank works with financial technology (fintech) start-ups to improve its services.

HSBC works with technology start-ups. Why?

We want to make banking simpler, faster and better for our customers. Making good use of technology is a fundamental part of that.

HSBC has its own tech teams designing new platforms and products, and they are absolutely brilliant. But we need to be humble and recognise that we don’t have all the answers. We invest in and work with fintech start-ups where we think they can help.

Is it making a difference?

Partnerships with fintech start-ups are already changing the services we deliver in a broad range of areas, with new tools and apps making banking more convenient for our customers.

Our partnership with Tradeshift is making it easier for business customers to manage their accounts and their relationships with suppliers online, saving time and cutting down paperwork.

Retail customers in the UK can now download an HSBC SmartSave app, developed in partnership with a start-up called Pariti. It helps them save money without even having to think about it. For example, they can set a ‘rounding’ rule so that every time they use their card to pay for something (costing, say, GBP9.66), the amount coming out of their current account gets rounded up to the next pound (GBP10.00), with the difference (GBP0.34) going to their savings account.

Other partnerships are helping us work more effectively behind the scenes. We have invested in a start-up which is developing technology that can sift through large amounts of financial transactions to pinpoint suspicious patterns. This will help us tackle financial crime more effectively, and, ultimately, keep our customers safer.

What technology will have the most powerful impact on HSBC in the next 10 years?

Artificial intelligence is constantly growing more sophisticated and is set to have a profound impact on the way banks work. Programmes that can make sense of huge quantities of information – ‘big data’ – could help us develop a better understanding of trends such as trade flows, for example. Computers capable of carrying out quick comparisons of products will enable advisers to focus on building relationships with customers.

But I’m not the oracle on emerging technologies. That’s why HSBC has a Technology Advisory Board to give us external advice and direction, highlighting industry trends. The Board volunteers have been hugely generous with their time, and it’s been great to see them really getting stuck in and helping us tackle problems and think about where we go next.

The important thing for HSBC is to keep listening and responding as the technology develops and customer expectations change. That’s how we will keep on making banking simpler, faster and better.

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