HSBC has named a former Google engineer as its latest retail bank and wealth management CIO, in a move that reflects the increasing importance of digital banking channels.
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Mark Warriner has joined HSBC retail from Google UK, where he worked for almost six years, reaching the role of director of engineering and also becoming chairman of Google Payments.
Banks increasingly need skills and experience that are traditionally associated with large technology companies. This is because customers crave digital banking services, particularly through smartphones, with challenger banks now existing that are based almost entirely on smartphones.
“I’ve been lucky to be at the forefront of pretty much every seismic technology wave over the past 40 years. My focus has always been on the use of technology to delight users, whether a multi-player adventure game I wrote at school or more recently the complete re-write of Google’s main publisher advertising system,” said Warriner.
He added that, despite its size and reputation, HSBC’s position is not guaranteed as consumer demands change. “Even the strongest can’t sit still. The market is moving rapidly, with new entrants taking advantage of mobile, artificial intelligence, chat bots and agile development,” he added.
Ganesh Balasubramanian, global retail banking and wealth management CIO, who Warriner will report to, said: “As we continue to adapt to evolving customer needs, we need the right people to bring new thinking to HSBC, ensuring we are able to offer the best possible banking experience.
“Mike brings a unique mix of deep technical knowledge, past experience of the banking world and Google scale, plus expertise in building and leading global technology teams. I’m delighted to have him join us as we continue to ensure our customers can bank with us when they want, in the way that they want.”
One source in UK banking IT industry said: “HSBC has been learning from Google in the past couple of years, so it’s no surprise if a few ex-Google [employees] get hired.”
Figures reveal the pace at which consumers are moving to digital banking channels. According to recent research by Visa of 2,000 people in the UK, more than 53% of people between the ages of 18 and 34, known as millennials, are regularly using mobile banking apps. In the UK as a whole, taking in all age groups, it found 38% regularly use apps to bank.
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- Consumers are quickly adopting fintech products and services, with young high-earners leading the charge.
- UK retail banks are under pressure from regulation, costs and increasing competition – here are six challenger banks using IT to shake up UK retail banking.
- The retail banking sector is going through a period of regulation-driven change and IT is playing a key role.
- The UK could be on the cusp of dramatic changes in retail banking following the launch of a current account comparison service.
Meanwhile, the British Banking Association recently revealed that more than 19 million people in the UK regularly logged on to mobile banking apps in 2016.
Due to this demand, skills associated with tech companies, which constantly develop digital products and services, are valuable.
Google is often cited, along with other tech giants, as one of the threats to traditional banks. Google is a huge processing engine which holds customer data and completes massive volumes of transactions 24 hours a day, and so it makes sense to offer financial services where most consumer online activity is already taking place.
Competition to traditional banks will also increase when the latest European Union (EU) Payment Services Directive (PSD2) becomes law.
PSD2 will enable third parties to access the customer data held by banks through application programming interfaces (APIs), if given permission, and offer services using this information.
Payments could be initiated by a third-party supplier and account information viewed through them, or both. This will mean a third party can build services on top of an account and allow the consumer to use these rather than those offered by the bank.
Banks would still hold the money, but would not be the main banking interface, meaning a consumer could have multiple accounts from various banks put together in a single mobile app, for example.