- Bank of America's top tech exec talks crypto, blockchain and other technology on her radar. - San Francisco Business Times - San Francisco Business Times
Bank of America’s Chief Operations and Technology Officer Cathy Bessant took advantage of the bank’s first digital summit this week to discuss her thinking on some of the latest technologies shaking up the banking world.
“This is the point where everyone wants to hear me say blockchain, or they want to hear me say digital currency, and I’m not going to say either of those things,” Bessant said, in response to a question about which technologies she's keeping a close eye on. “In financial services, we believe distributed ledger technology — the technology that underpins much of the discussion around digital currency and digital exchanges — we believe that’s a new and exciting technology.
“We have yet to find a solid use case for it in financial services,” Bessant said, echoing a point she previously made at a San Francisco fintech conference.
Technologies that are higher on her radar are 3-D printing and 5G, the next generation wireless network technology.
“3D manufacturing, and the ability to do distributed manufacturing, is one of the most important things that we as financial institutions have to think about much more entrepreneurially,” Bessant said. ”If I can’t get people into a mail center to mail out credit cards, do I have a way to digitally print those credit cards in a way that’s accessible on a retail basis?”
She also said 3D printing could also be useful for a customer needing a book of checks. But another technology may also help on that front: A BofA executive told those attending the summit that of the bank’s 13.5 million users of the Zelle online payment service, 75% didn’t write a single check in 2020. That’s 9.8 million fewer checks.
“5G is extremely, extremely important,” Bessant said, pointing to the challenges that can come with speed and connectivity issues. “There are other countries that are ahead of the United States in 5G as a form of infrastructure and as universally available. Not a new technology, but execution globally — and of course in the U.S. — I think really, really will dramatically change our ability.”
But it’s her comments on the bank’s partnerships with fintechs and other third parties that may resonate more with Bay Area fintechs that work with BofA or want to do so.
“When the board asked me about one of the most important sets of learnings in the pandemic I usually begin with the importance of third parties, whether they are emergent technology companies or some of the largest names in the business,” Bessant said. “What you learn in a time of crisis is your ability to function depends on the quality execution of the third parties that are part of your ecosystem.”
Bessant said the pandemic offered an BofA an opportunity to work with new fintechs, including a partnership with a third-party vendor that helped the bank meet the demand for the SBA’s Paycheck Protection Program. She did not identify any fintechs by name.
Early in the pandemic, Bessant said the bank turned to its major suppliers to meet the bank’s urgent need to equip thousands of employees with the necessary devices to work from home. The bank went from almost 200,000 people in the office every day to at least 185,000 employees working from home. That presented all sorts of challenges.
“On pre-positioning devices — portable devices with our key people — many times in the past we’ve made that judgment based on cost. It’s a completely different rethink to base it on resilience,” Bessant said. “Every day someone’s without their device, they’re ineffective.”
Hailing back to her early days in banking, Bessant said just as character is a consideration in lending, it’s also an important factor in choosing vendors.
“Character becomes extremely important with third parties in times of stress, because we will make decisions as a firm to only work with third parties who have our customers’ and clients’ best interests at their heart, not just ours, and who think about resiliency and safety and focus in the same way that we do,” Bessant said. “We saw a lot of variation across the board.”
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- Date of publication:
- Tue, 05/04/2021 - 15:41
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