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Ben Kepes is a technology evangelist, an investor, a commentator and a business adviser. His business interests include a diverse range of industries from manufacturing to property to technology. As a technology commentator he has a broad presence both in the traditional media and extensively online. Ben covers the convergence of technology, mobile, ubiquity and agility, all enabled by the Cloud. His areas of interest extend to enterprise software, software integration, financial/accounting software, platforms and infrastructure as well as articulating technology simply for everyday users.

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One response to “Social Media Doesn’t Constitute Banking 2.0–Apple and Google Get That”

  1. Jeffry Pilcher | The Financial Brand

    Some other points to consider.

    First, Apple will never become a bank. Ever. It’s one thing to talk about processing payments. It’s another thing entirely to talk about taking deposits, issuing credit cards, making loans, offering investment services, etc. Just because an organization can facilitate payments does not make it a bank, nor does it mean the organization intends to become a bank. The same things could be said of Facebook.

    That 50% of the world says they’d bank with Apple is interesting, but inconsequential. 50% of the world would buy ANYTHING from Apple — tires, lipstick, concert tickets, etc. That doesn’t mean Apple has any interest/plans to enter these markets. Apple sticks to industries that people like, want and enjoy… not icky commodities people despise because they are life requirements (e.g., banking).

    To answer your question about why so few financial institutions “innovate at the core”… There are about 14,000 retail financial institutions in the US. Those who have even the ability to “innovate at the core” number less than 250. Why? Because only the über big banks run their own core data processing systems. The other 13,750 banks and credit unions have to buy their core DP systems from third-party suppliers. The core infrastructure required to run a bank is so large and complex, it is waayyyyy beyond what a financial institution can afford to build.

    Even the vendors who make the DP systems struggle to keep up with their own software. It usually takes them 2-3 years to roll out a new platform.