Elevate the Edge
Elevate the Edge
34. Edge in Financial Services Institutions with Theo Lau, Unconventional Ventures
Guest Bio: Theodora (Theo) Lau is the founder of Unconventional Ventures, a public speaker, and an advisor. She is the co-author of Beyond Good, and host of One Vision, a podcast on fintech and innovation. Her monthly column on FinTech Futures explores the intersection of financial services, tech, and humanity. She is also a regular contributor for top industry events and publications, including BBC News, Finovate, American Banker, and Journal of Digital Banking.
Hello and welcome back to the podcast. This is Maribel Lopez and as always I am joined by the fabulous Jo Peterson who today is wearing something that looks like teal glasses. So that is today's glass eyewear discussion. We are excited to be joined by Theodora Lau or Theo, as she likes to be called. She is the founder of unconventional ventures. She is a public speaker and advisor. She's the co author of Beyond Good and the host of one vision a podcast on finance and innovation or FinTech, I guess we should say. Her monthly column on FinTech futures explores the intersection of financial services, tech and humanity. She's also a regular contributor for top industry events and publications, including BBC News Finovate, American Banker and the Journal of digital banking. Theo, welcome to the program. How're you doing today?
Theo Lau:Good. Thank you for having me. Now, if I knew Jo was gonna have such fab glasses, I should have gotten myself a pair because it's amazing. You actually have it matching with your sweater?
Jo Peterson:Yeah, that wasn't on purpose. I don't know what happened.
Theo Lau:And gotcha See, found like a whole setup and impressive.
Jo Peterson:That's a thing. Yeah, you know, I gotta mid century jam. That's, that's the thing.
Maribel Lopez:I love it. Love it, it is the thing. So when you someday, see us in 3d, you will know who Jo is. So you know, at the I'm just gonna jump right in here. And, you know, we're here. We're talking about finance, we're talking about the edge. You know, large consulting firms like Accenture are talking about how edge computing is one of the most promising texts for the banking industry. Of course, we've had a lot of discussion about generative AI in the past few weeks as well. But since this is a podcast on edge, we're gonna talk about edge. And in many ways, we're seeing the financial industry already using edge computing to create hyper personalization and customer experiences, to secure information to reduce operational costs, and also to do things like try to figure out how they adhere to international data governance standards. So with that, as a backdrop, I'm wondering, you know, you're an expert in this space, what are some of the things as use cases you're seeing emerge as it relates to fintech?
Unknown:I wouldn't call myself an expert. First of all, I do dabble into space. But I think it's interesting. One of the things that people like to talk about a lot is, oh, the bank branches are going to be gone, we're not going to have bank branches, we're not going to have physical money. Guess what I am of the camp that I think was so cool to have paper money, I still use paper money with my kids. And I'm still out of the camp that I think we'll still need branches, branches might be different. And so this is where I think agile will come in. And it will be really interesting as a concept of a micro bank branch, one that has all of the capabilities that you will have in a fully featured bank branch, but shrunk down to a super, super small footprint, with more advanced ATMs with video chat. So those things like you know, facial recognition that knows who you are, when you step in, or having a virtual teller, those were the things that were not possible before because we have latency issue, we have speed issues. But now we can think about perhaps offering those things. And now, we can also think about offering a physical presence for places that mangles had been thinking about closing down the branches because of cost. And in that way, we can actually maintain the being a physical presence with communities oftentimes is in far flung places. And that way people do not have to drive far to go to a bank branch in the city. And the one important thing and I'm a big believer in it, is being present in a community can create relationship and trust with people that you serve, instead of just everything digitally. So that will be one huge benefit. I think, edge computing will play in financial services. And conceivably, hopefully in the not too distant future, we will have actually functioning robot at the branch that greet customers, not the ones that just sit there and look pretty and doesn't really work too well. But once actually work.
Maribel Lopez:Love where you're going with this because it actually speaks to some of the evolution that we've seen happen over time. I mean, there was the branches dead concept, as you mentioned. And then there was the branches, the Experience Center where it went all the way to like it's going to be a cafe and you're going to come in and hang out. And it's like, well, perhaps that's not what we really needed. But what is really interesting, I think is the mix of digital, physical and human engagement that happens in a branch to your point, they could be smaller, they could be more contextual, and you know, do things such as recognize you when you come in, know, instead of just generic ads, the right things to service you while you're waiting, they can have a mix of both virtual and human assistance that can help support you. So there's just a lot of change in terms of how we're thinking about banking and how we think about personalizing it. And you started to mention some of the technologies that you're seeing come together in the financial space, you know, we were talking about edge computing. You know, when you start talking about robots and other things, we're talking about AI and IoT. So when you look at what a customer experience might look like, in the future, how do you see that changing in the financial services industry?
Theo Lau:I, I love how you end the question with customer experience, because I think it's important, that's the one thing we tend to forget is financial services is also about service, right? It's also about dealing with people, it's not just about money, it's not just about transactions. And so that's why I think it will be interesting to see where tech can go with that. So let's go back to that branch example, for a second that we just talked about. We talked about using AI, and recognizing who you are, perhaps we can go even one step further doing facial expression analysis, and help optimize that branch and, and help the customer have through improving their experiences, know how they're thinking, know how they're feeling. That's always important, because we always complain, while you know, you don't know me. And beyond the micro branch. Another thing that's interesting in financial services is insurance. Insurance hack is a wonderful, wonderful example where we actually see a lot of these things, not just talking about it, but actually being implemented. So imagine drones being used for claims investigations, they can capture thermal imaging, they can look at details like how much moisture there is trapped in the rules. And beyond the claims adjustment, they can also use drone technology to inspect to do site survey, assess the risk, and monitor for natural disaster. All of that helps not only because previously, you have to actually get into dangerous structures or hard to get to places. But most of all, it makes the process a whole lot easier, a whole lot quicker, and more accurate. And all of that goes back to customer experience. How do we help provide a better level of customer experience with the technology that we have?
Jo Peterson:And loved where your customer experience and I was reading this really interesting article, and it came as a surprise to be but it shouldn't have that billions of adults worldwide don't have a bank account. I never thought about it right. And that's about global digital inclusion. What are a couple of ways that you can think of that edge computing can help create more digital inclusion in the banking space?
Theo Lau:It is it is hard to imagine that. And one thing I often say as there is no financial inclusion without digital inclusion. So we have to solve that part first. Overall, globally, there about 1.4 billion adults who still lack access to formal financial services 1.4 billion, that's a lot of people. And having access to formal financial services allow them access to credit, which is really important for for example, smallholder farmers, small businesses because they need that capital to sustain or even expand their businesses. So without that, it's kind of like stuck where they are. So one of my favorite example, I would say favorite examples often come from Asia. For example, there is a company called Aqua Connect is based in Chennai, and they use AI and satellite remote sensing technologies to provide farm advisory to help farmers improve their productivity, but more importantly, bridge the gap between the farmers and financial institutions, so that they can have access to micro loans. There are also countless other examples in other emerging economies where a farmer is able to get loans based on what they have planted in the field. Now imagine having the technology looking at what you've planted, validating what you've planted using AI and then connecting the farmers with the lenders and say, Okay, we have validated, this is what they've planted and, you know, they can have now have access to micro loans. So those I really, really important to help get the resources to farmers. Or in other instance, we talk a lot about climate change, right. So with climate change, there is drought. Previously in farmers experienced drought, they lose everything they plant, they have to wait the next season. But now with the technologies we have in the field, the farmers can actually get replenishment seats right away. So they don't have to wait for the next planting season. And then with that, they can get everything reimbursed, and go on with you know, what they are doing. So I think those are some amazing, amazing ways that we can improve not just financial access, but also improve the well being of people.
Jo Peterson:What's a great answer? So let's say that you are a bank, and you want to do digital inclusion, and you want to get edge technology out there. IDC did a survey that said 42% 42% of businesses say that the most challenging aspect of the edge is putting together an entire solution, right? Because it's emerging and evolving. So what would be a few suggestions that you might have for a financial institution looking to the point at solution,
Theo Lau:find the right partner. That's what I always say is find the right partner, find the right partner that understand your needs. And also have the technology know how to help guide you through because this is not a small journey, if you will, right. And you need to look at not just the tech front, but also look at what consumers want. What do your customers need? Who are you servicing? So, you know, we talk about changing ways that customers are using services, they might be banking, anywhere, you might be banking, anytime they might be using different connected devices, or they could be starting a transaction with a device, and then finishing it off in a branch. So there are a lot of different scenarios that they could be transacting and interacting with your institution. So who is out there that can a understand what you need be understand what your customers need, and see understand the space enough that put everything together and doing it in a secure way?
Jo Peterson:Well, you know, I love me a little cloud and security. You know that.
Theo Lau:That was like our first conversation. Oh, my goodness, Joe. At least. I want to say six years ago.
Jo Peterson:Oh, yeah. It's been a long line. Yes. Yeah. We were talking. We were talking edge and cloud security when it wasn't cool. Feel. I'm just saying if I'm just say no, it's cool. And the cool kids are talking about it. But we were at least I was an uncool kid talking about it. But no.
Theo Lau:Cool. And I'm like learning so much from you. So you too.
Jo Peterson:And I'm you know this, you're making me think about some things here. And along with a good acronym, I love me a good survey. So Forrester and arrow labs, because I'm always putting these like serving stats, right for guests. And you know, I don't want you to feel left out. So I want to do one for you, too. So Forrester, Intel and Red Hat conducted a survey, there's a magic word, and October 22 of 230. FinTech or financial services, it execs. And one of the top five priorities was sort of the stuff we're talking about here, harnessing emerging tech to create customer and business value. So you've already given us a couple good things. But can you add one more to the list of how edge is specifically helping here?
Theo Lau:Hmm, that's a trick question. Right? Because we talked about we talked about video intelligence, we talked about site survey. Real Time authentication. That's another one, right, knowing who you are being able to authenticate. I know, I know, people are a little bit split on that. But having been through the airport, many, many times through Global Entry, I will be the first one to say please just tick my face. It's so much easier than just in the line and waiting for the passport stamp. It is it's helpful technology. Now, obviously, you know, with that being said, with so much data out there, it goes back to your favorite spot. Joe, how do we keep it secure? So I think, you know, all of these use cases are wonderful, you know, being able to to detect crime, being able to detect fraudulent activities, being able to assess risk and all of that. It's all going wonderful. Most important is how do we make sure that our money is safe and the customer data is safe.
Maribel Lopez:I want to pick up on a couple of trends that you have placed in there because I think they're important. If we go back for a second, one of the things that you mentioned is multichannel. So if you think about multichannel, and then you couple that with the authentication methods that you were just talking about, and the security that Joe was just talking about, it's actually a fairly complex thing to execute on. So you have to actually, in order to deliver really good customer experience, you have to offer your experience in the channel that your customer wants to be in, or the channels most likely, because they're not in one, they're in different ones at different times, you have to streamline the authentication of that, right. So it might be voice authentication, if you're on a smartphone, it might be facial recognition, if you're walking into a branch, right? So there's, there's a role for that. But to your point, we have to keep all of that data secure. And we also need still some format of multi factor authentication, because we proven that any given single technology can be spoofed somehow. So you need to have combinations of them to make that happen. So I think in financial services, it ends up being a pretty tricky, complex thing to align those all at the same time. But if you can, it can be super powerful, and just deliver really interesting seamless experiences. And then I think where the edge comes in, and AI is really getting you to that context in the moment, guided experiences, next best actions, there's a lot of cool, fun stuff that's happening there. But you know, those are just a couple of my thoughts. I was interested in having you put your crystal ball hat on and talk about your top projections for edge and financial services space, and let's just say 12 months, because after that, you know, the world could be a totally different place. So what do you think?
Theo Lau:12 months, I'm thinking, you know, actually, in three months, the world will be completely different space. I mean, come on. And none of us would have foreseen what would be happening right now, last year, we knew well, you know, these certain things will be interesting. But we didn't know what would have dominated our headlines the last two weeks, with a bank, whose name I shall not name. But it's hard to do prediction, I will do one on a use case that I think it is going to be super interesting as and imagine your car, having an embedded wallet. And your car can pay for parking, and pay for tow. And you don't have to fish out your change, or your mobile phone and frantically look for the app to download and put in the code. Now how cool is that? The tech is already there. Right? And I think it's just a matter of putting the pieces together. device to device. Okay, let's payment.
Maribel Lopez:So we got a thing on this podcast that you don't know about. But this is a perfect time to introduce this podcast and what did I do? No, no, no. And this is the thing where somehow we get to put Chick fil A in yet another podcast. So now you've got your car with your digital wallet. So you can just cruise through Chick fil A and pay even easier than you have in the past. Right? So yes, once again, Chick fil A for the win.
Jo Peterson:Believe people you need to sponsor us
Maribel Lopez:How do you like we've had so many guests talk about check that I just had to bring it up.
Theo Lau:Oh, that's excellent. And imagine being able to actually pre order it with your car. makes it even easier. You just read through and pick up my blog.
Maribel Lopez:See, that's why they put that big touchscreen in there. So you could see if it was like the eight piece of the 12 piece chicken nugget right there. That was it. That's why Tesla put in that huge tablet now I know. All right, so I think we've hit that official time where we're talking about the fun fact. Is there a fun fact that you'd like to share with the audience that doesn't have to be technology related?
Theo Lau:Let me ask you this. Do you know when was the last time add $1,000 Bill was printed?
Maribel Lopez:Since I've never seen $1,000 Bill, I never think of this. So no, I have no idea.
Theo Lau:December 27 1945. That was the last time a high denomination though was printed. And it was officially discontinued July 14 1969. That was wildly cool. Uh huh.
Maribel Lopez:Well, who the heck knew. That's it.
Theo Lau:I never saw either. But I thought that was interesting. Like, oh, we talk about money. So here There's one fun fact about money.
Jo Peterson:I love that. That's great. Made me think about Vegas for some reason. I don't know
Maribel Lopez:if there were going to be $1,000 Bill turned down somewhere. It would be it would
Jo Peterson:be Vegas. Yeah. It has to be. Actually not
Maribel Lopez:just another place that we talk about a lot. You see a certain case of it,
Jo Peterson:because we go to Vegas a lot, protect conferences.
Maribel Lopez:Thankfully, we don't gamble or else it'd be really devastating to our
Jo Peterson:fillet on the plane, I would see.
Maribel Lopez:There you go. Once again, we can work in the chick fillet All right. We actually really are health conscious people for those on the podcast or listening wondering why we're always talking about fast food. It just I don't know how it happened. It just started it started with like, our man from North Carolina Bobby and it just kept going from there.
Jo Peterson:It comes back to buy me that's all.
Theo Lau:No. Chick fil A without remembering you to
Maribel Lopez:Well, thank you for you. It's been so much fun having you and we look forward to following everything that you're writing about. Talking about in the tech space, which obviously it is a very exciting and slightly scary time and financial services. So hopefully we'll be talking about happy stuff on the other side of this. This is elevate the edge. Have a great time, folks. Thank you.
Theo Lau:Thank you for having me.
