Banks – “Don’t Panic”, says Wells Fargo’s Ellis
“We have made life very complicated, but there are simple answers,” said Steve Ellis, head of wholesale services at Wells Fargo. “The most import thing to hang your hat on is the customer. This is a place where there has been a lot of change and there will continue to be change – to me it is more about opportunity than threat.”
Ellis was speaking at the opening of the International Payments Summit conference in London. His presentation was billed as looking back to a speech made by Heidi Miller, then head of the treasury and securities services businesses at JPMorgan Chase, at the opening of the 2004 Sibos in Atlanta, in which she set out four ‘existential’ questions and five challenges to the transaction banking and payment industries.
Reduction of complexity for the industry and customers was her key theme.
“Are things still overcomplicated? Yes” said Ellis, but the industry should follow the advice of the Hitchhikers Guide to the Galaxy: “Don’t panic.”
“We tend to look at things through the lens of yesterday, and focus on things like control and risk mitigation,” he said. “Look up – so many people are looking down and worrying about their budgets. When were those budgets made? My April 2014 budget was probably decided in August 2012 – and I know so many more things now than I did in August 2014.”
People should focus on strengths and get things into perspective. “[Cybersecurity] is a big deal, but don’t get paranoid about it,” he said. “We’ve been really good at stopping people stealing money electronically – it’s the safest way to move money anyone has come up with. People have been trying to hack into banks since we’ve been online, but it changes when they are not trying to steal money – when people are just trying to screw you up with denial of service attacks.”
Addressing this issue is one area he thinks that the industry needs to work together to solve, but that is not a strength: “We don’t do a good job working through things together, and when we don’t other people do it for us – whether it’s governments or new competitors.”
Security, however, is a strength of the banking industry. Harnessing the opportunities of new technologies like smartphones with existing capabilities is an example of one of the ways in which complexity could be reduced for banks and their customers. “How many ways does Wells Fargo currently authenticate a consumer? More than 100, depending on which products and channels they are using,” he said. “Mobile gives us the opportunity to authenticate the customer rather than the chip on their card. We can leverage these tools to cut through the complexity and create a better customer experience.”
That customer experience is at the heart of things, he said. “if we focus on the right things – customers and what value is for them – I don’t think it’s an overly complicated world,” he said. “It is about long term customer relationships – banking isn’t something you just do once.”