Economics

Process Journal

08/05/17
Goal: research about how can technology change bank?

From the past people have to queue to withdraw money or pay in cheque. However, now
bank has developed their system, people can do online and on mobile banking (Apple pay, google
wallet). Moreover, there are many other companies that provide convenience to people by their
technology. So banks have to keep updating themselves to survive.

Technologies that change banks

- online banking (more than half of people prefer online banking)
- mobile banking: using smartphones to do online transaction
- application
- bank shut down their branches
- online transactional activities
- bill pay
- view balances
- view statement
- money transfer
- no physical money
- minimal staffing
- FinTech (will do more research about this later)
- wearable apps
- smartwatches
- human teller machine (Teller assist allowing customers to talk to a live teller)
- For customers who wanted some help with their banking problems

How banks keep relationship with customers? (online and offline coordination)
- smart banking branch (smart banking is a revolutionary banking experience designed to
attract, engage and connect clients with products and services)
- new design (futuristic looking)
- intuitive touch screens
- high definition media walls

Why bank have to change?

- new generation people are using more technology
- a lot of competition (other FinTech start-ups)
- new technology
- Biometrics (finger print) in stead of PIN code
- artificial intelligence
- digital cheque

Daily Reflection:
Today I did a research about how can technology change bank. And the information that I
got is less people are going to the bank due to the development of technology. The technology have
a lot of impact on banking. People can do their transactional activities by using technology such as
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smartphones and smartwatches, without walking in to the bank branches. Bank also developed their
services like super ATM that can do more than just depositing or withdrawing to provide
convenience to people. Then, I was curious that how will banks keep relationship with customers
because if there are very few people who go to bank, many bank branches will be shutting down.
Some banks create activities that can be done in bank such as yoga class or family entertainment,
and some are developing in the way of technology to make people come to bank.

Sources:
- https://www.youtube.com/watch?v=1CKxMqD8jo4
- https://transferwise.com/us/blog/5-ways-technology-has-changed-banking
- https://internetofbusiness.com/technology-future-banking/
- https://www.mybanktracker.com/news/mbtslider/8-incredible-ways-technology-changed-
banking/#4
- http://www.cnbc.com/id/100925605
- https://thefinanser.com/2013/04/why-all-banks-will-change-core-systems.html/
- https://thefinanser.com/2016/02/the-top-ten-trends-in-banking-innovation.html/

Next goal: research about how FinTech and Bank collaborate?

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15/05/17
Goal: research about how FinTech and Bank collaborate?

Currently, people start to use FinTech due to the technology making bank become less
important. Hence, the banks have to change their own methods of services for people.

What is FinTech?
- FinTech = Financial Technology
- gradually develop intersection of financial services and technology
- can refers to start-ups (young company), technology companies, legacy providers
- It is about using technology to design and deliver financial products and services
- company that is using software to provide financial services
- The FinTech start-ups create a disruption to financial
Who is doing this?
- large financial institutions (banks) incumbent (responsible/necessary)
- big tech company (Apple, Google, Facebook, Twitter)
- companies which provide infrastructure/technology that make financial service transaction
easier (MasterCard, First Data, NASDAQ)
- start-ups (focused on innovative technology or process)
Impact of FinTech on Bank
- Start-ups are more in innovative but less in capitals
- Banks have lots of capitals but behind in innovative
- Banks have to change itself because people change to the using of technology
- customer shift away from using bank branches to digital
How Bank and FinTech collaborate?
- banking is changing because FinTech
- Bank like JPMorgan Chase and Bank of America partnered up with tech players to improve
their tech capability

Daily Reflection:
I did a search about FinTech but I'm still a bit confused about how FinTech impacts banks
and how they work together. So, today I understand what FinTech is and who is using FinTech.
Furthermore, I still have to do a research about how companies like Apple, Google, or Facebook
involve FinTech and how banks respond to these companies.

Sources:
- https://www.pwc.com/us/en/financial-services/publications/viewpoints/assets/pwc-fsi-what-is-
fintech.pdf
- https://www.forbes.com/sites/nikolaikuznetsov/2017/04/07/collaboration-is-the-way-forward-for-
banks-and-fintech/#296df2e16fdb
- https://www.goodcall.com/personal-finance/fintech/
- https://www.accenture.com/th-en/insight-future-fintech-banking
- https://www.business.com/articles/how-fintech-is-changing-business-and-bank-accounts/

Next Goal: Research about how FinTech is applied in big company, and how bank and the big
companies work together.
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16/05/17
Goal: Research about how FinTech is applied in big company, and how bank and the big
companies work together

FinTech is one of the topics that banks are worried about because many companies provide
financial services for people such as Apple Pay. However, Apple Pay is still working with major
credit and debit cards from the top banks. People have to use bank accounts to use/register most
FinTech services. But, people dont have to go to bank branches anymore because they can pay
within apps.

FinTech and big company (Apple Pay)

- provides privacy and security for their customers
- pay within app and web
- can add many card and choose which one they are going to use to pay
Bank and the financial services company
- big banks and some financial company are partnership
- they create a better, faster and safer payment
- bring offline and online world together (by Apple Pay)
Ways FinTech and Bank will be in the future
- more and more innovation
- bank and FinTech will team up
- FinTech competition will drive banking transformation
- Bank will have to increase the service quality

Daily Reflection:
Today I got some new information about FinTech and bank, and know how they develop
their company to provide services for people. However, I look back at the topic I have chosen and I
think that may be I am way out of topic. So, I am going to focus more on the topic about how bank
will be in the future include their inside and outlook. Anyway, the information that I have been
searching is still important because it makes me understand the reason why bank have to transform
itself.

Sources:
- https://thefinancialbrand.com/42321/banks-promote-apple-digital-payments/
- http://bankinnovation.net/2016/12/11-ways-fintech-and-banking-will-change-in-2017/
- http://www.avoka.com/blog/top-5-fintech-banking-trends-2017/

Next Goal: Research about technology in bank in the future

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17/05/17
Goal: Research about technology in bank in the future

To focus on bank, I am going to start from the out looking of future bank. How will the
future banks look like from the outside. What will they improve to make people want to walk into
the bank branches. What innovations will they develop.

What are banks going to improve to make customers want to stay contact with them?
- customers are now digital customers
- Digital influence customers behavior, expectations, and needs
- 20% of customers are digital-only users
- Bank have to improve their customers service
- customer service employees have to have
- accurate, up-to-date, and consistent information
- answer customers question immediately
- easy way for customers to search for information
- give people financial education
- ex. bank partnered up with Khan academy
- build trust
- be transparent (no cheating, etc.)
- stay consistent and reliable
- become an advisor (not just a lender)
Bank and their future technology
- mobile payment option
- increase security
- voice identification
- eye scanning
- change old data to new formats
- drive through video teller devices
- provide 24/7 real tome access to bank
- chatbot: conversational commerce (message) within app
- make an important financial decision
- can handle complaints or concern
- can sell their products
- get customers feedback
- provide investment portfolio update
- operate a trade to buy or sell shares
- deliver transaction notification
- use blockchain to lower their costs
- upgraded ATM: protecting against ATM hacks
- partnerships: with other FinTech

Daily Reflection:
I can find a lot of information about how technology in bank will be in the future, and how
bank will improve their technology in financial services. Moreover, I found some information about
blockchain such is said that it can reduce bank costs. Also, it can solve many problems for bank, so i
will find more information about blockchain next time.
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sources:
- http://silvercloudinc.com/blog/8-ways-to-improve-bank-credit-union-customer-service/
- https://www.accenture.com/t20150710T130243__w__/us-en/_acnmedia/Accenture/Conversion-
Assets/DotCom/Documents/Global/PDF/Dualpub_17/Accenture-Banking-Consumer-Pulse.pdf
- https://thefinanser.com/2017/01/5-banking-tech-trends-2017.html/
- http://www.businessinsider.com/the-future-of-banking-growth-of-innovative-banking-fintech-
services-2016-12
- https://internetofbusiness.com/technology-future-banking/

Next Goal: What are the advantages of blockchain technology in bank?

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18/05/17
Goal: What are the advantages of blockchain technology in bank?

From yesterday research, I am going to find more information about blockchain and what
ways can blockchain technology improve bank. Moreover, I will do research about how bank and
blockchain will collaborate in the future.

What is blockchain?
- a secure transaction ledger (a book or collection of financial account) database
- it is shared by all parties in a distributed (spread) network
- creating a irrevocable (cannot bring back) and can be audit (can be check) transaction history
- blockchain can reduce friction (resistance) in financial network when different intermediaries
(go-between) use different infrastructure
- reduce the need for intermediaries (middleman) to validate (check) financial transaction
- create opportunities to generates major efficiency gains
What banking problems can blockchain solve?
- double spending
- the issue of trust
- prevent other from making change of transaction
Lower cost is a key benefit of blockchain!

Daily Reflection:
Today I did a research about blockchain. I do understand that blockchain is a digital ledger.
It is like a block that have a set of recording. The blocks are added to the block chain in a linear,
chronological order. Furthermore, blockchain can also help banks solve some problems and the
main thing that blockchain can solve is the lower the cost.

sources:
- https://www.henrystewartpublications.com/sites/default/files/02_Buitenhek_JDB_V1.2.pdf
- https://www.ingwb.com/media/1609652/banking-on-blockchain.pdf
- http://www.investopedia.com/terms/b/blockchain.asp

Next Goal: Understand more about how bank, FinTech, and Blockchain related
 Economics
19/05/17
Goal: Understand more about how bank, FinTech, and Blockchain related

current FinTech that banks are using

- ATM
- credit/debit card
- online payment
- financial transaction
- payment transfer
- loan
- saving
bank centralized network: banks are the center of all transaction
- third party: collect all the information (easy to be hacked)
- From card
- every information is on only 1 place
- no transparency: hard to check
- high cost in transaction part
- direct cost
- indirect cost: time, transportation cost, fee (user1 to bank1 to bank2 to user2)
- difficult for microeconomics: poor people or SME hard to access banking loan
decentralized network (blockchain)
- hard to hack
- everyone can check the transaction at anytime
- dont need to have intermediary (peer to peer)
Development of FinTech
- startups (dont need bank anymore)
- crowd funding: dont have to get loan from bank (loan from public)
- using apps to lend money such as lending club (peer to peer lending)
- buying and selling stock without commission (robin hood)
- E-commerce such as Alibaba
- Ali pay (user to business)
- easy to use
- safe
- 24/7
- quickly respond to the need of the customers
why blockchain is more secure
- bank system: have only one server, one data base
- when it is hacked the hacker can change everything in there
- no more original copy left if the data is changed
- blockchain system: have many server and data copy
- it is hard to change because every one have each other transaction/data base copy
- you can easily check
- if hacker want to hack, they will have to hack more than 50% of the user
- it will be used by 15% of big banks by 2017
neobank
- neo = new
- updated and upgraded bank
- a conventional bank with no physical branches
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- using mobile applications and websites to provide their services
- advantages
- lower cost for bank
- increase serving speed
- reduces cost of service and more convenient for people
- can have many features; personal finance management

Sources:
- book: blockchain revolution written by Don Tapscott and Alex Tapscott
- http://marketeer.co.th/archives/79585
- http://www.bangkokbiznews.com/blog/detail/638030
- https://techsauce.co/country/thailand/thailand-fintech-startup-landscape-2016-q1/
- https://www.bloomberg.com/news/articles/2017-02-24/fintech-the-buzzword-finance-loves-and-
hates-quicktake-q-a
- http://wealthpilgrim.com/lending-club-reviews/
- http://www.investopedia.com/articles/active-trading/020515/how-robinhood-makes-money.asp
- http://fortune.com/2016/09/28/blockchain-banks-2017/
- http://eng.banks.eu/news/info/2289
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