Without right tech mindset, banks will face Kodak-style obsolescence
(Bloomberg) -- Banks could face a “Kodak moment” where they approach obsolescence in five to 15 years at the hands of new financial-technology companies, according to former Barclays Plc Chief Executive Officer Antony Jenkins.
Traditional banks are already seeing the start of an “Uber moment,” whereby the industry is being transformed by technology such as smartphones and contactless cards, Jenkins said in an interview with Bloomberg Television on Wednesday. But the industry is also being transformed by cloud computing, artificial intelligence and machine learning technologies.
“The Kodak moment is completely different -- that’s where customers realize there’s a totally better and different way of doing what they want to do, and the incumbent becomes obsolete,” Jenkins said. “The Kodak moments are the ones that I think will come in that five-to-15 year period.”
Eastman Kodak Co., the photography pioneer that sold the first consumer cameras in the 19th century, struggled to adapt to an era where digitization usurped film and filed for bankruptcy in 2012. It emerged a year later focused on commercial printing as a much smaller company than it was in its heyday.
Britain’s biggest lenders are closing branches and increasing their investment in technology as customers increasingly do their banking online or on their phones, while a wave of fintech startups have made their first inroads into the consumer market. Banks may struggle to transform themselves despite their spending, as they don’t have the right “culture or mindset,” Jenkins said.
Jenkins, a long-time credit-card executive who was ousted from Barclays in 2015 as the firm moved to a strategy more focused on its investment bank, is the founder of 10x Future Technologies, which aims to sell cloud-based computing systems to banks.