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Collaboration and the future of digital banking: Elina Mattila at Mobey Forum

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As established financial institutions seek to reclaim their market share over and above fintech disruptors, they need knowledge as well as capital. Collaboration is essential to harnessing new developments in AI, cloud technology and other innovations.

There’s big money involved, too. Just last week, Palantir – the AI developer controversial for its involvement in shady US government surveillance programs – – – went public at a valuation north of $20bn. Leaked files from August revealed that not only were federal agencies among its bespoke pool of customers – Chase Bank and various hedge funds were also getting stuck in (albeit briefly). Meanwhile, Amazon started trialling its first biometric payment system.

So there’s uncertainty and a great deal of risk involved with new technology, but the message is clear: knowledge is power (and woe betide those left behind).

Mobey Forum is a not-for-profit bringing banks, payment services and other institutions together to harness new technologies. Founded in 2000 by 13 major financial institutions, its membership has expanded and diversified over the past five years in the wake of the fintech revolution.

Executive Director Elina Mattila, based in Helsinki, shared with us the story behind Mobey Forum, what it offers its members, and what makes it different from tech accelerators:

Why was Mobey Forum founded in 2000, and who were the main drivers behind the project?

Mobey was formed in 2000 to encourage adoption of mobile technology in financial services and to help marry these emerging technologies with the security requirements of the financial industry, ultimately enabling greater interoperability.

Mobey’s specific role was to be an active liaison between industry leaders – both key individuals and companies. The founding members were:

  • Merita Bank
  • ABN-Amro
  • UBS
  • Deutsche Bank
  • Barclays Bank
  • HSBC
  • VISA
  • Banco Santander
  • BNP Paribas
  • SEB
  • Ericsson
  • Motorola
  • Nokia

Since Mobey Forum was founded, much has changed in the fortunes of financial institutions, especially through technology adaptation. How has Mobey developed to support its’ members through the changing digital landscape?

“At the beginning, mobile payments were a key focus, with banks, handset manufacturers and mobile network operators (MNOs) forming the primary stakeholders. Since then, the role of MNOs and handset manufacturers has diminished as the physical secure element was replaced by software solutions (device operating systems still have a key role, of course, but the influence of hardware manufacturers has since reduced).

“Conversely, banks have remained at the center of the payments ecosystem and have always been the main focus for Mobey. We examine new technologies, services, and business models, always with the aim of establishing what they mean for banks.

“Over the years the composition of our membership has changed to incorporate a broader range of stakeholders as different kinds of players have entered the market. The topics that we focus on have also evolved, in line with developments in the industry.

“Initially payments were the main focus area for Mobey, but over time we have broadened this scope significantly and now explore a host of other digital services for banks. Some of the key areas that we have focused on this year, for example, are open banking, digital identity and data privacy.

“It is interesting to look at how Mobey’s focus has evolved. In many ways it chronicles the history of digital financial services since the turn of the millennium. Between 2001 and 2010 we were addressing topics like payment architecture, Secure Elements (SEs), and mobile authentication. Then from 2011 to 2013, the focus shifted to NFC payments, mobile wallets, mPOS and host card emulation. More recently, we have been analysing trends and topics relating to biometrics, open banking, virtual currencies and of course, the Internet of Things. Our aim is to identify and analyse the commercial drivers and points of disruption that will shape the industry two to five years from now.

“Even the words that we use to describe Mobey have developed in tandem with the industry. Our focus used to be on ‘mobile financial services’. Now we talk about ‘digital services’. The user’s device has become far less significant; services are delivered via tablet, phone, watch… the device itself is less important.

There are many Fintech Accelerators across Europe that offer similar member benefits both for StartUps and for Banks and Payment companies as Mobey itself does. How does Mobey differentiate itself amongst these new associations and incubators?

“Mobey Forum is a place where banks can come together in a commercially neutral environment to exchange experiences and learnings and identify best practices. It’s a forum where banks can discuss what has worked and what hasn’t with peers from other non-competing banks. We provide the platform for those types of discussions in our Member Meetings and in our Expert Groups – both of which always take place under Chatham House Rules to increase the level of trust and enable openness and frank discussions of the real issues.

“A lot of the same people come to our Member Meetings and participate in our Expert Groups, so they get to know each other very well and create deeper and more trusting relationships.

“Mobey is very different from fintech accelerators or incubators. We don’t invest in or promote any companies or technologies. We are a global industry association focused on empowering banks to shape the future of digital financial services.

“Mobey is a member-based organisation with around 50 members, including, among others, banks, card schemes and technology providers. We are open for any organisation to join us, large or small. Our members includes some familiar names, such as BBVA, ING, HSBC, UBS, TD Bank, Thales, Idemia, Giesecke-Devrient.

How is Mobey helping its members adapt to the heightened technology needs of the post-COVID era and the following 5 years?

“As we navigate the new path forward, banks have a window of opportunity to reflect on the learnings to date and use them to build a digital-first banking ecosystem which will serve customers for the years ahead. Digital identity schemes, for example, together with the rise in available data, are both areas that could be used to drive additional value for customers.

“With the right level of cross-industry collaboration and planning, the banking sector can help the global economy emerge from the Covid-19 pandemic stronger than before. Addressing the key issues affecting banks and other financial institutions is the key focus for Mobey Forum’s Expert Groups. Our Digital ID group recently published a report exploring the impact of the Covid-19 pandemic on digital identity services, to help banks better understand how to respond to market demand and the impact of contact tracing apps on the digital identity landscape.

“The disruption caused by Covid-19 is pushing banks into unchartered waters. They must manage both the financial impact and the increasing demand for digital products and services from customers. The pandemic has highlighted that there is still much work to do on the digitalization of financial services and has sparked new discussions about what should be prioritised. In these times of uncertainty, collaboration is crucial to banks’ success. That is why Mobey Forum exists: we bring the industry together to share key learnings and establish the clarity that can help the industry navigate the new path ahead.

Recent months have presented unexpected opportunities for digital banking, with the use of e-commerce and digital payments services on the rise throughout the pandemic.

Looking into the future, institutions will also be keeping an eye on where governments allocate their investment funding, as Covid-related relief funds wind down and plans to support research and development in growth industries restart. These investments may prove yet another shake-up in the industry.

Through all this, competition for technological talent and knowledge will remain fierce ­– as will incentives to collaboration and knowledge-sharing.

Author: Oliver Rhodes

#MobileWallets #NFC #Payments #DigitalID #TracingApps #MobeyForum