Open banking is not only the transformation of products and technologies, but also the transformation of banking systems and mechanisms, including the comprehensive transformation of the front, middle and back offices.
Editor’s note: This article comes from the WeChat public account “Nine Gua Financial Circle” (ID: jiuguajinrong) author: Xu Xiaoqing, Li Shang Yu, Zhao gold.
Huang Zhengjian, Deputy General Manager of the Retail Network Finance Department of Industrial Bank
The new crown epidemic in early 2020 has become a touchstone for testing the technological strength of the banking industry, and banks are fully advancing digital transformation. The overall strategic planning and layout of many banks’ fintech shows that the understanding of digital transformation has become increasingly clear, not only to advance the digital transformation process from the perspective of the entire bank’s strategy, but also to plan the digital transformation goals more specifically and build differentiated Strategic Direction.
The public believes that open banking represents the only way for banks to digitally transform. Many banks, including Industrial Bank, have actively deployed open banking construction in recent years, and have formed their own characteristics and first-mover advantages. After the inspection of the new coronary pneumonia epidemic this year, how to choose the open bank model? What is the goal of digital transformation? What is the direction? What points should be noted?
With these questions, Jiugua Financial Circle recently interviewed Huang Zhengjian, deputy general manager of the retail network finance department of Industrial Bank.
Open Bank: Currently the most reasonable is the API model
In recent years, Industrial Bank has firmly pursued the strategy of “science and technology development”, actively embraced fintech, with digital transformation as the starting point, focusing on promoting the construction of “safety banks, process banks, open banks, and smart banks”. Strengthen the concept of “jumping out of the bank to become a bank”, speed up the construction of open platforms and scenarios, broaden customer acquisition channels, increase customer stickiness, build a “new ecology” of Internet services, and extend service contacts from finance to life scenarios. Industrial Bank has been thinking about its own digitalization process. Especially since the outbreak, people’s consumption habits and behaviors are changing. Banks use their own digital methods to speed up the operation mode.
During the epidemic, the open bank showed a unique advantage. Use technology to develop financial business, and open up technology and business capabilities to the outside world. Accurately reach and serve users in an open scene, and build an open banking ecology with the purpose of maximizing user value.
Open banking is not only the transformation of products and technologies, but also the transformation of banking systems and mechanisms, including the comprehensive transformation of the front, middle and back offices. To promote technologyDeep integration with business and strengthening technology empowerment, many banks are currently deepening the new round of technological and institutional reforms, and have made great strides in organizational structure, institutional mechanisms, and resource investment to build new advantages in mechanisms.
In Industrial Bank ’s technology application layout, open banking and scene interconnection are the parts that have to be mentioned.
Introduction by Huang Zhengjian, Open Bank currently has two main implementation modes, one is H5 mode and the other is API mode.
“The API model needs very strong technology, management needs to be systematic, the process is complicated, and the background needs to have a special system support, not just an interface. At present, the industry is actively exploring.” Huang Zhengjian said.
In terms of API export cooperation, Huang Zhengjian believes that the ability of banking products and services is a bank ’s advantage, and the Internet ’s risk control capabilities are what banks need to learn from and learn from advanced Internet companies.
Industrial Bank has always been committed to creating an open bank. Through API interfaces, banks and partners form a shared platform for information system docking, which is different from the market ’s breakthrough direction of using personal users (ie, C-end) as an open bank. The bank’s exploration of open banking starts with its best-in-class interbank and financial market (F-end) to create the ability to “connect everything”.
The current main battlefield of the Internet is shifting from “to C” to “to B”, and the era of industrial Internet has already begun. Industrial Bank has long focused on the “main channel” of industrial Internet services, and has a leading position in the pan-B end, especially the F end service battle. It has formed a relatively broad “moat” in the field of interbank and financial markets.
According to Huang Zhengjian, the characteristic of the open bank that Industrial Bank is committed to is that it is based on the leading edge of the F-end and further copies it to the government (ie G-end) and enterprise end (ie B-end) to continuously promote the GBC end Scenario expansion and ecological interconnection, through interconnection and interoperability, let financial services reach the “end-of-thousand households” of the C-end, forming an open ecosystem of FGBC collaboration, linkage and integration.
In F-end, Industrial Bank relies on non-bank (financial institution) fund management cloud platform, bank-banking platform, and “money master” to provide services. By the end of 2019, Industrial Bank ’s interbank customer coverage rate exceeded 90%.
The fund management cloud platform is an integrated and comprehensive platform serving non-bank financial institutions. As of the end of 2019, a total of more than 550 online platforms have been launched. A large number of funds have been deposited through various depository and settlement businesses. Using scientific and technological means, the proportion of standardized products has been continuously improved .
Yinyin platform is a financial inter-bank cooperation brand launched by Industrial Bank, providing wealth management, payment settlement, technology export and other services for various small and medium-sized financial institutions. As of the end of 2019, there were 2022 legal entities in various business cooperations on the Bank-Bank platform, an increase of 6.09% year-on-year; a total of 372 commercial banks have established core business information system partnerships and 226 have been launched.
“Qianda Shopkeeper” is an Internet wealth management platform. By the end of 2019, a total of 54 cooperative bank wealth management products have been introduced, with 14.377,000 registered customers.
On the basis of inter-industry cooperation, Industrial Bank will further extend integrated financial services such as depository settlement, agency payment, agency sales, and asset management to corporate and individual end customers, forming a full-chain customer service system.
Huang Zhengjian predicted, “I believe that the last bank that can win in the scene must be the bank that can provide the most convenient service to customers. The bank may only be a backstage in the future. The most reasonable way for open banks to be at present is the API model. The API is hidden in the background, and it is a non-sensical experience for customers. I think this is definitely decisive. “
Digital first priority is products and channels
Huang Zhengjian believes that the number one priority of digitalization is products and channels, not business model disruption. “The digital transformation of banks has become more of a channel reconstruction. Digital finance should recreate more products, no longer be limited to technical departments, and become a bank breaker. Digital finance is a bank breaker within the bank.”
Facing digital transformation, scenario-based sketching of customer portraits, embedding customer needs into life scenes, and achieving seamless connection between customers and scenes have become the mainstream direction of the financial industry. At present, data technology has a certain foundation, but has not yet formed a Life needs create an ecosystem of services. Since customer demand data is relatively lagging, it still takes time to break this constraint.
Huang Zhengjian believes that “the combination of products and scenes can be seen by everyone. In the end, many of the bank’s business will indeed be embedded in the middle of the scene. From this perspective, there must be a considerable part of the banking business that has been transferred, not The bank’s own channels can do it. It may be through this scenario, whether it is a consumption scenario or other scenarios, as long as it can reach the customer and then allow the customer to generate business with the bank, you can do it. This must be a diversion. . I think it should be a business that can be done on the original channels of the bank that has diverged a considerable part. “
Huang Zhengjian predicts that in the context of scenes, services and technology-driven business, quickly building his own ecosystem to provide customers with ubiquitous scene-based financial services is the future development direction of banks.
Huang Zhengjian believes that when banks talk about digitalization, Internetization and other concepts, the core cannot be separated from the bank ’s own business to see digitalization. At present, no business will be subverted by digitalization. He believes that the most likely subversion of bank digitalization is channels. The essence of real banking business is very difficult to subvert. “Financial connotation is hard to lose, no borrowing? No payment? Even if digital currency comes, it still exists. Digitalization is just to do banking businessbetter. “Huang Zhengjian said.
“Digitalization is just to do better for banking business.” He believes that the real digitalization is products and channels. “The digital transformation of banks has become more of a channel reengineering. Digital finance should reinvent banking products and no longer limit technical departments. Become a bank breaker. Digital finance is a bank breaker within the bank, subverting product subversion channels. “
“Digitalization should be a change in business model, and the process of digitization should be the adjustment of business ideas and models. If the understanding of digitalization is not yet in place, you may not want to understand the business model.” Huang Zhengjian believes that the digitalization process is not a one-off process. Within traditional banks, first of all, they must have certain basic digital capabilities, and it will take two or three years for real bank-wide promotion to change.
Huang Zhengjian disagrees with the idea that digital subversion of banks. When talking about the significance of “digitalization” to banks, Huang Zhengjian believes that it is still too early to talk about “digitalization” for the transformation of bank business models. “As long as the bank’s business needs to issue a license, it cannot be subverted digitally. If all borrowing does not require a license, the bank will be subverted with the support of technology.”
Digital finance transformation should pay attention to four aspects
Huang Zhengjian believes that banks are currently undergoing digital transformation, which is a trend. The process of digitization is actually a process of changing business ideas, or an adjustment of the business model. The original model is more extensive and cannot accurately reach customers. “The result of digitization is to see more clearly where the customers are. In what way to reach these customers, so as to better meet customer needs. “
However, the process of digitization is long, and the tortuous advancement is the trend of constant new things. Huang Zhengjian believes that the following four points should be paid attention to regarding digital transformation:
1, Thought transformation is the premise of digital transformation
Huang Zhengjian believes that the premise of digital transformation is the transformation of ideas, which is also the foundation. The second is that the related supporting mechanisms and systems must follow changes, and finally the human resources. “Digitalization should be a change in business model, and the process of digitization should be the adjustment of business ideas and models. If you do n’t understand digitalization, there will be no changes in business models. You may not even understand the business model. It ’s all empty. “
2, Application ability is the core of digital transformation
What is the core of the so-called bank digital transformation? Data is at best the foundation, and how to use this data is the key. Huang Zhengjian believes that the ability to apply data is the core of digital transformation. For example, he said that this is actually the same as platoon formation. A bank uses the data model to launch the corresponding digital marketing plan is related to application capabilities.
Huang Zhengjian said frankly that the digital transformation of traditional banks cannot be used overnight. Therefore, digitalization has a lot of homework for banks, especially talents. Now banks should reflect on digital transformation. How to do talent reserve, on the one hand, to introduce talents, on the other hand, old employees also need to be trained to become people with this ability.
3. Market recognition is the key to winning digitally
Huang Zhengjian believes that when banks talk about digitalization, Internetization and other concepts, the core cannot be separated from the bank ’s own business to talk about digitalization. The bank ’s business must meet the needs of the market. At present, no business will be subverted by digitalization. The most likely to subvert is the channel.
The essence of real banking products is very difficult to subvert. He believes that market recognition is the key to verifying the success of digital transformation. Without market recognition, there would be no customers, and without customers, there would be no business flow, just like passive water and no roots, so technological innovation and application of scenarios should be embedded in people’s livelihood.
4, Establish fault tolerance mechanism
Huang Zhengjian believes that digital transformation is very important, it is to have a fault-tolerant feeling. Establishing a fault-tolerant mechanism is conducive to creating a working environment that advocates innovation, supports exploration, and tolerates failures. It is also conducive to eliminating the worries of “don’t want to do, dare not to do, and can’t do”, and inspire employees’ enthusiasm and motivation for technological and digital transformation. The fault tolerance mechanism is very important, and it is difficult to start innovation without the fault tolerance mechanism. Now many bank employees are engaged in repetitive work in the assembly line, and some people hold a wait-and-see attitude to innovation, waiting for others to fail to read jokes, such a psychology must be.
Will the bank’s network finance department become “oversighted”?
The author noticed an interesting phenomenon, that is, the topic of digitalization catalyzed by the epidemic, which also attracted the attention of the Internet Finance Department, which was originally in the middle and back office.
Internet finance is a form of commercial banking business development, from online banking, e-banking, direct banking, Internet finance, Internet banking, digital banking, open banking, etc., the business development of commercial banks has evolved with the development of information technology, and the corresponding organizational structure and department settings are constantly updated and perfected. . This is a process and trend of continuous iteration and dynamic evolution.
Recently, in order to develop digital finance, some banks have specifically upgraded the original network finance department to a digital finance department. For example, China Everbright Bank upgraded its e-banking department to a digital finance department in 2019. Some banks have also merged online finance with other business lines. For example, the online finance department of Industrial Bank was included in the retail sector, and the department was renamed the retail online finance department. This is the integration of the Bank of China and the personal finance department, wealth management and private banking department into the “personal digital finance department” and “in 2019” “Consumer Credit Department” has similarities.
In the industry, there is always controversy about the future development of the Internet Finance Department. Some people think that the Internet is still a long way to go. Therefore, such departments as the Internet Finance Department will also exist for a long time, and some people think that banks will form a full Internet in the future. The online financial department is only a staged organization and will eventually be merged into other departments.
Huang Zhengjian is a proponent of the second view. He believes that the banking network finance department is likely to disappear. He said: “Digital transformation, the first thing to transform is the banking thinking, as this thinking gradually internalizes and penetrates into various business departments, then the specific network finance department will disappear.”
Huang Zhengjian believes that the number one priority of digitalization is products and channels, not business model disruption. “The digital transformation of banks has become more of a channel reconstruction. Digital finance should recreate more products, no longer be limited to technical departments, and become a bank breaker. Digital finance is a bank breaker within the bank.”
Facing digital transformation, scenario-based sketching of customer portraits, embedding customer needs into life scenes, and achieving seamless connection between customers and scenes have become the mainstream direction of the financial industry. At present, data technology has a certain foundation, but has not yet formed a Life needs create an ecosystem of services. Since customer demand data is relatively lagging, it still takes time to break this constraint.
Huang Zhengjian believes that “the combination of products and scenes can be seen by everyone. In the end, many of the bank’s business will indeed be embedded in the middle of the scene. From this perspective, there must be a considerable part of the banking business that has been transferred, not The bank’s own channels can do it. It may be through this scenario, whether it is a consumption scenario or other scenarios, as long as it can reach the customer and then allow the customer to generate business with the bank, you can do it. This must be a diversion. . I think it should be a business that can be done on the original channels of the bank that has diverged a considerable part. “
Huang Zhengjian predicts that in the context of scenes, services and technology-driven business, quickly building his own ecosystem to provide customers with ubiquitous scene-based financial services is the future development direction of banks.
Huang Zhengjian believes that when banks talk about digitalization, Internetization and other concepts, the core cannot be separated from the bank ’s own business to see digitalization. At present, no business will be subverted by digitalization. He believes that the most likely subversion of bank digitalization is channels. The essence of real banking business is very difficult to subvert. “Financial connotation is hard to lose, no borrowing? No payment? Even if digital currency comes, it still exists. Digitalization is just to do banking businessbetter. “Huang Zhengjian said.
“Digitalization is just to do better for banking business.” He believes that the real digitalization is products and channels. “The digital transformation of banks has become more of a channel reengineering. Digital finance should reinvent banking products and no longer limit technical departments. Become a bank breaker. Digital finance is a bank breaker within the bank, subverting product subversion channels. “
“Digitalization should be a change in business model, and the process of digitization should be the adjustment of business ideas and models. If the understanding of digitalization is not yet in place, you may not want to understand the business model.” Huang Zhengjian believes that the digitalization process is not a one-off process. Within traditional banks, first of all, they must have certain basic digital capabilities, and it will take two or three years for real bank-wide promotion to change.
Huang Zhengjian disagrees with the idea that digital subversion of banks. When talking about the significance of “digitalization” to banks, Huang Zhengjian believes that it is still too early to talk about “digitalization” for the transformation of bank business models. “As long as the bank’s business needs to issue a license, it cannot be subverted digitally. If all borrowing does not require a license, the bank will be subverted with the support of technology.”
Digital finance transformation should pay attention to four aspects
Huang Zhengjian believes that banks are currently undergoing digital transformation, which is a trend. The process of digitization is actually a process of changing business ideas, or an adjustment of the business model. The original model is more extensive and cannot accurately reach customers. “The result of digitization is to see more clearly where the customers are. In what way to reach these customers, so as to better meet customer needs. “
However, the process of digitization is long, and the tortuous advancement is the trend of constant new things. Huang Zhengjian believes that the following four points should be paid attention to regarding digital transformation:
1, Thought transformation is the premise of digital transformation
Huang Zhengjian believes that the premise of digital transformation is the transformation of ideas, which is also the foundation. The second is that the related supporting mechanisms and systems must follow changes, and finally the human resources. “Digitalization should be a change in business model, and the process of digitization should be the adjustment of business ideas and models. If you do n’t understand digitalization, there will be no changes in business models. You may not even understand the business model. It ’s all empty. “
2, Application ability is the core of digital transformation
What is the core of the so-called bank digital transformation? Data is at best the foundation, and how to use this data is the key. Huang Zhengjian believes that the ability to apply data is the core of digital transformation. For example, he said that this is actually the same as platoon formation. A bank uses the data model to launch the corresponding digital marketing plan is related to application capabilities.
Huang Zhengjian said frankly that the digital transformation of traditional banks cannot be used overnight. Therefore, digitalization has a lot of homework for banks, especially talents. Now banks should reflect on digital transformation. How to do talent reserve, on the one hand, to introduce talents, on the other hand, old employees also need to be trained to become people with this ability.
3. Market recognition is the key to winning digitally
Huang Zhengjian believes that when banks talk about digitalization, Internetization and other concepts, the core cannot be separated from the bank ’s own business to talk about digitalization. The bank ’s business must meet the needs of the market. At present, no business will be subverted by digitalization. The most likely to subvert is the channel.
The essence of real banking products is very difficult to subvert. He believes that market recognition is the key to verifying the success of digital transformation. Without market recognition, there would be no customers, and without customers, there would be no business flow, just like passive water and no roots, so technological innovation and application of scenarios should be embedded in people’s livelihood.
4, Establish fault tolerance mechanism
Huang Zhengjian believes that digital transformation is very important, it is to have a fault-tolerant feeling. Establishing a fault-tolerant mechanism is conducive to creating a working environment that advocates innovation, supports exploration, and tolerates failures. It is also conducive to eliminating the worries of “don’t want to do, dare not to do, and can’t do”, and inspire employees’ enthusiasm and motivation for technological and digital transformation. The fault tolerance mechanism is very important, and it is difficult to start innovation without the fault tolerance mechanism. Now many bank employees are engaged in repetitive work in the assembly line, and some people hold a wait-and-see attitude to innovation, waiting for others to fail to read jokes, such a psychology must be.
Will the bank’s network finance department become “oversighted”?
The author noticed an interesting phenomenon, that is, the topic of digitalization catalyzed by the epidemic, which also attracted the attention of the Internet Finance Department, which was originally in the middle and back office.
Internet finance is a form of commercial banking business development, from online banking, e-banking, direct banking, Internet finance, Internet banking, digital banking, open banking, etc., the business development of commercial banks has evolved with the development of information technology, and the corresponding organizational structure and department settings are constantly updated and perfected. . This is a process and trend of continuous iteration and dynamic evolution.
Recently, in order to develop digital finance, some banks have specifically upgraded the original network finance department to a digital finance department. For example, China Everbright Bank upgraded its e-banking department to a digital finance department in 2019. Some banks have also merged online finance with other business lines. For example, the online finance department of Industrial Bank was included in the retail sector, and the department was renamed the retail online finance department. This is the integration of the Bank of China and the personal finance department, wealth management and private banking department into the “personal digital finance department” and “in 2019” “Consumer Credit Department” has similarities.
In the industry, there is always controversy about the future development of the Internet Finance Department. Some people think that the Internet is still a long way to go. Therefore, such departments as the Internet Finance Department will also exist for a long time, and some people think that banks will form a full Internet in the future. The online financial department is only a staged organization and will eventually be merged into other departments.
Huang Zhengjian is a proponent of the second view. He believes that the banking network finance department is likely to disappear. He said: “Digital transformation, the first thing to transform is the banking thinking, as this thinking gradually internalizes and penetrates into various business departments, then the specific network finance department will disappear.”
The author noticed an interesting phenomenon, that is, the topic of digitalization catalyzed by the epidemic, which also attracted the attention of the Internet Finance Department, which was originally in the middle and back office.
Internet finance is a form of commercial banking business development, from online banking, e-banking, direct banking, Internet finance, Internet banking, digital banking, open banking, etc., the business development of commercial banks has evolved with the development of information technology, and the corresponding organizational structure and department settings are constantly updated and perfected. . This is a process and trend of continuous iteration and dynamic evolution.
Recently, in order to develop digital finance, some banks have specifically upgraded the original network finance department to a digital finance department. For example, China Everbright Bank upgraded its e-banking department to a digital finance department in 2019. Some banks have also merged online finance with other business lines. For example, the online finance department of Industrial Bank was included in the retail sector, and the department was renamed the retail online finance department. This is the integration of the Bank of China and the personal finance department, wealth management and private banking department into the “personal digital finance department” and “in 2019” “Consumer Credit Department” has similarities.
In the industry, there is always controversy about the future development of the Internet Finance Department. Some people think that the Internet is still a long way to go. Therefore, such departments as the Internet Finance Department will also exist for a long time, and some people think that banks will form a full Internet in the future. The online financial department is only a staged organization and will eventually be merged into other departments.
Huang Zhengjian is a proponent of the second view. He believes that the banking network finance department is likely to disappear. He said: “Digital transformation, the first thing to transform is the banking thinking, as this thinking gradually internalizes and penetrates into various business departments, then the specific network finance department will disappear.”