I had a chance encounter with the head of IT for a new challenger, mobile-only bank this week. He was incredibly passionate about its offering and how it wanted to break down barriers, shake up the establishment and give customers real service.
I liked him and I certainly liked his customer focus, so we ended up having a long conversation about the delivery of retail financial services to the public.
He was proud that the company now had its banking licence and could really get to work on improving the lot of the banking customer. He showed me the app it delivers all its services through and I must say I was impressed.
The functionality is great. For example, customers can open an account in minutes via just their smartphone and lock lost or stolen cards in a swipe.
Location services mean a card will not work if it is not in close proximity to the customer’s phone, unless the customer tells it to. Then there are budgeting tools and payment tools, and foreign exchange to come.
Much of this is achieved by linking up with other top-end mobile service and app providers to build a comprehensive eco-system that delivers all the parts of banking a retail customer could want. It certainly leaves my banking app for dead, and I suspect it might do the same to yours. So what, you might be asking? Well, the conversation then turned to what was on its road map: Isas, Lifetime Isas and portfolio management, rather obviously I suppose.
As well as engaging with clients on a transactional banking basis, it wishes to move into the more subjective, relationship-type of services like investments.
It will, in effect, also be a platform – and this is where it really did get my attention. If it can achieve scale, it can begin to drive real cost savings and incredible investment functionality to customers in a way they want to receive it.
So, once again, I return to the subject of robo-advice but from a different angle. As someone who worked for a financial planning division of a bank and saw all the faults despite the potential for synergy and service, this could be the beginning of something really big. No legacy systems but state-of-the-art technology built from scratch with one purpose: to serve a client.
It is not just the banks that should watch this type of development with interest but all of us in retail financial services, from asset managers to platforms, all the way through to advisers. This could begin to look like a closed eco-system from which we could be excluded.
Obviously, I take the point that much of what advisers do is more complex than I have outlined here, but the passion with which it was described and the will to challenge our accepted truths should give us all cause for reflection.
We should certainly not assume its drive for customer service, efficiencies and functionality will not touch us.
Lee Robertson is chief executive of Investment Quorum