Financial Models Make a Major Shift

The business model of financial services, primarily banking, will undergo a significant shift soon. The next big thing would be ‘Contextual Banking’ supported by various technologies such as Blockchain, Open API, Social Mining, Fintech startups, government and finance/risk professionals, marketers, and data scientists.

Technologists, data miners, digital experience experts, and risk professionals will be creating our future models in banking.

Of course, each of these has its particular definition of actions and operations that they do, such as; government and finance/risk professionals may integrate innovating new regulatory models. Each of these categories is ripe for discovery and explanation.

As an example, Compumatrix uses several of these areas such as; Blockchain, Social Mining, Advertising through marketing, and so much more for a more robust and connective environment. We also have experienced 1st hand the need for close looks into risk management and regulations around the world, so some of this is not new to us at Compumatrix.

How many of you have heard of “Contextual Banking”?

I haven’t, and so it was interesting to find out. And then, I found out I did not know a precursor to Contextual Banking, which is Contextual Commerce, so we have two new terms to add to our language.

Contextual commerce merely means thinking beyond a brick and mortar storefront for doing all business online. It is a whole new way of life where a consumer can buy anything, anytime, anywhere with the simple point and click of a button

Like contextual commerce, contextual banking is getting rid of the brick and mortar building in favor of all banking services online. There will be many companies creating their own branded debit accounts to become “contextual.”

Contextual banking will completely change the way banking is done now. It’s an evolving model, where financial products and services come to you at the place and time of need. Banking will become life enablers where services are delivered in a contextual and embedded fashion across various channels consistently and quickly. Banks create digital customer experiences based on your context with the help of data and technology. At the same time, risk experts will ensure that these transactions are smooth while guaranteeing your experience to be regulated and secure.

Another possible parallel would be that every retailer will become a banker. Considering the fast and the furious Fintech scene now, you do not need a ‘Bank’ to do essential banking services. Every retail outlet will act as a bank, selling banking services. Fintech companies are already doing great work at debt funding platforms, equity trading mechanisms, and payment processing hubs. We can see fast adoption and acceptance of this new way of banking services. A whole new model is emerging, driven by a change in technology, customer expectations, and a competitive landscape of the entire world scene.

Since Compumatrix was created and uses a black chain as its financial connection primarily, we can see things such as; Blockchains are emerging as a robust and secure digital record-keeping method. Nasdaq started using Blockchain technology in its private stock market to secure record-keeping, one of the world’s largest systems that have facilitated the trading of financial assets for decades. How can blockchain technology change existing banking processes? Blockchain’s power comes from the fact that it can process transactions in a secured fashion and create a perfect and reliable digital record.

Blockchains will revolutionize the payment industry, trading, and security management.

So with blogging, social media, and advertising switching screens as it was because the marketeers and data scientists gathering information gives importance to particular products and desires, we will say, “Goodbye Salespeople.” Welcome Social Selling, which will be the most significant disruption due to contextual banking. The replacement of direct sales force and relationship managers from banks. Those hefty incentives and commissions will turn to fee income for banks.

Selling banking products will be delivered at any channel or place the customer is available; this will be achieved by converging social, cloud, and data. Understanding and Leveraging Social Data will be a new Social phenomenon. Along with other trends, it will shift the balance of power to consumers, accelerating the need for greater engagement, which will give great interest, recognition, and boost to our company well.

Due to this new financial construct, all commercial and wholesale banking will go digital. Many financial institutions will maintain their visual and concrete visages, but they will all be gone due to maintenance costs one day.

Corporate business models will embed banking, where purchase and accounting happen over the cloud. Major wholesale banking players like HSBC, CITI, and Morgan Stanley have already started to deliver digital solutions to giant corporations.

Financial space is changing a lot in all areas such as regulation, technology, compliance, demographics, changing customer expectations, the rise of Millenials, and competition from fintech. Customers become increasingly disappointed and confused with their banking experience. At the same time, they’ve become increasingly comfortable with going through their favorite social network or retail provider to buy financial services.

We have already started experiencing new ways of payments, micro-financing, investment advice, money management, trading, etc. even small Blockchain companies such as Coinbase are growing exponentially and buying up the competition. Older online payment systems such as PayPal, are in turn, starting to offer newer services trying to compete.

This movement of banking and financial services to the online digital realm is the next logical Big Step!




About the author

Sam and Jody live in Mena Arkansas and love Compumatrix. Life is simpler when sharing life with others, and being a Christian I see how being there with and for others enhances their lives. How can Compumatrix make your life better?

Comments

  1. Sometimes I feel like I am living in a science fiction movie with all the new things and changes we are experiencing. It is hard for me to comprehend and keep up! But…I am trying to digest a little here and a little there. Eventually, I hope it will all begin to seem more normal – lol.

    1. Thanks Andrea, and this is how I see it; things changing as fast as they are, and this process is not new; just remember what they said when the very 1st stories of Flash Gordon 1st came out; that we would never go to the moon. Then that the computer or Internet would never work, much less last?? We as humans accept as Normal what the world accepts and embraces as part of life.

  2. Well, I knew it was coming just didn’t know when but I guess it is here already this is the first I heard of contextual Banking. Technology is moving so fast I can barely keep up I noticed at Walmart you can scan all your items now with your smartphone and scan the register now and go and I believe they are using blockchain to keep track of there products so it is really taking off fast the next 10 years is going to be very interesting. I heard elementary students today will never have a driver’s license cause they won’t need one with computerized cars that drive themselves.

    1. Funny though, things changing as fast as they are, and this process is not new; just remember what they said when the very 1st stories of Flash Gordon 1st came out; that we would never go to the moon. Then that the computer or Internet would never work, much less last??

  3. great info Sam — and agree it is almost living in sci-fi movies of older times — this cyber crypto world moves so fast it is almost like you actually need to storage and memory like a computer to keep up with the speed factor — it is very challenging to put all this in the right perspective ?? but working on it daily —

  4. It worries me that normal people will get marginalized. I am of an age where new technology is tolerated and often seen as invasive. The more our assets are removed from our control the more worried I become. Banks are closing branches, more and more shopping is done online and we all have a little plastic card that supports everyday life. Our data is known to many many institutions and companies. Fraud is widespread so unless there are far greater supervision and regulation I am not sure I want to become more detached from reality. When my assets are available I know what I wish to do with them without leaving them in a vulnerable state in an operation that I have little control over. One massive hacking operation could see millions disadvantaged

  5. Thank you Sam for great information! In this rapidly changing world of technology, we have to keep pace.We have to equip our brains with this technology,blockchain technology has changed every system of life.
    In 2020 It was going to have the world wide Expo of Blockchain Technology in Dubai, but due to the covid 19 it was postponed,now it will be in 2021 I think all of us compumatrix members should participate in it so that all of us members can also meet there,this will give us a lot of information about blockchain technology.

  6. Thank you for explaining contextual banking. Your pictures were very helpful as a visual aid. This edifies what Compumatrix has done for us with our business. I feel we are ahead of the pack with the continuous changes in blockchain technology and Fintech. It will be our responsibility to help and share with family and friends. Very exciting times for our business and the crypto space. I feel truly blessed to be a member of Compumatrix.

  7. I am so very, very, very grateful that I can trust Compumatrix to do the best for their members and to always have their backs. When information regarding all the banking, investment choices change, I don’t become concerned. Again, because Compumatrix is on our side! And also I don’t feel that I have to try to learn all these terms, uses, etc. All this great information can be filed away and taken in small bites over time!

  8. As 2020 approached we knew advancements in digital and blockchain use were coming. However, we did not know how COVID would force the adoption by many institutions to utilize these new avenues. With all countries in lock-down, resourcefulness to reach people to carry on in the finance and business world was key. Globally, contextual banking is making more opportunities available to more people because they have simple technology; a cell phone!

  9. Thanks for interesting article. Never heard of Contexual banking so it was very interesting to read your article. As to banking services, most of them here are offered online long ago, so I don’t have to leave home to pay taxes, utility bills and so on. All of this I do through my bank online.

  10. I agree that the banks are getting rid of their premises, and also staff. Many people shop from ads on social media and small companies have their own websites. Almost everything can be paid for online nowadays, but I wish that more companies in my country adopt blockchain technology and crypto currency.

  11. Unfortunately, I see two sides to this. Yes, progress is good, and with the state of things right now and the silly virus and people scared to go out, I suppose this is a good thing. However, I hate to see traditional ways of doing things turn into the nostalgia of tomorrow. Just my thinking out loud.

  12. Contextutal banking is a new concept but its high time to form part of the progress and flow with the tide. Thank you for this information. Lot more to learn and to implement, and put it into practice.Technology is certainly moving too fast and we need to sprint along and learn quickly. Thank you, Sam!

  13. Another good read and very informative. Showing the changes that we as a people are all now going through right now as well as how can move along with them and take advantage of them. To not be surprised and caught off guard as the old ways move toward things being done online. Paper free

  14. It worries me how your activity on the net can be used to target you with ads that will entice you to buy more and more things that you don’t really need. So many younger generations rely on their smart phones for banking and other things and this is spreading pretty fast to the older generations that are not really technology savvy to cope with it. It almost feels like it is imposed on people too fast and some will be lost in this digital world of technology.

  15. this is such a great read and when you look more and more at each part of the blog — and then you put the speed of the technology factor into the mix and with each new or enhanced version of some part — not only do you literally have learn the new concept but also all the news terms or groups of words that now mean this where maybe 10 years ago that group didnt exist or had a couple words of this and a couple other words of that — it is a very intriguing adventure — great stuff literally Sam thank you — rj

  16. Thanks for your blog, Sam. Yes, the cyber world is changing every day. The people that are not computer savvy are going to be lost in the future. It will not take long for banks to start to close there brick and mortar storefronts. Once they are not profitable the will close them down. It seems that the corporate world only cares about the all mighty dollar. The public being in need of there services will soon be without. Look out the cyber world is here.

  17. Fascinating blog, Samuel. You struck a chord of excitement in me, stirring my already excited demeanor. We are moving from what was to what is new and the most private and secure means of doing transactions in the digital and crypto arena via Compumatrix CDAP. We will be putting into practice what you expressed any day now. I am so excited to behold all this technology opening the door and moving us into the twenty-first century.

  18. Interesting to say the least. Never heard of Contextual banking before. I guess it is too soon to say if this will be a good move or not. What I am reading so fare Blockchains will revolutionize the payment industry, trading, and security management. Technology is moving way too fast for many, especially those with less experience in this so different market. Personally, I do already everything online when it comes to banking, but I am thinking also about those we are leaving behind because of all of this.

  19. We live in a fast changing world now. As part of the baby boomers it has been a challenge to keep up with new technological advances of our modern world. While some of that generation may have fallen behind, I believe many have kept up and learn new things like Contextual banking as it comes out. It is great to be able to learn new concepts. Thanks Sam.

  20. As part of the baby boomers it has been a challenge to keep up with new technological advances of our modern world. While some of that generation may have fallen behind, I believe many have kept up and learn new things like Contextual banking as it comes out. It is great to be able to learn new concepts. Thanks Sam.

  21. With everything being handled remotely i feel like I am losing control of my assets and ultimately my ability to control my life. Fortunately I am able to telephone my bank and talk to a human being and perform the tasks i require if they are not simply activated by my online banking element. In the remote version you often get asked questions that you simply cannot answer because of the poor phrasing of requests or understanding of language. Once we get to this stage I fear we are in a very bad place..Hopefully CDAP will be simple to use for all age groups.

  22. That was very thought provoking blog Sam. I am having a hard time wrapping my head around how fast technology , blockchain etc. is affecting my life . I find it hard at my age to grasp all the changes. My mind is still back when everything was … Keep it simple .I am learning what I can . But I still live in the speed of dial up. LOL ..

  23. this is so good of a read and after reading the latest blogs and you put this with those latest and I start to see how so much of everyday is intertwined and changing into a Contextual Life almost — and agree at points of my day how I do miss the KISS method of older days gone by — But? However? — lol — Change is Fact — Yeppers and it is Happening as I type this it has changed — rj

  24. Since our ancestors changed the use of stone to iron tools, hunting to farming, and bartering to banking. Banking to Contextual banking. CHANGE is inevitable.
    Thank God that he made Man with a mind to think and make changes for a better living

  25. I hadn’t heard the term contextual banking, but I was aware that things are being done online more and more. I see offers all the time to open a bank account at an financial institution that is completely online. In my opinion, I can see the convenience of being able to take care of business quickly and easily online, but the downside for me is the uncertainty of not being able to go to the bank face-to-face when you encounter a problem with your finances. I like doing things online, but I’m still not used to the idea of a bank that is totally online.

  26. Very informative blog Sam.Yes we are rapidly moving in the new Technology,and our financial system is also seeing a rapid change into the new digital world.We are happily seeing our company Compumatrix transition well into this change in changing times of the Fintech.

  27. Thank you for the very informative blog, Most people don’t want change at all and when they hear about it they get upset as being left behind. I’ve been warning some for over a year and now you see it coming.

  28. Thanks Sam for one more word to add to my tech vocabulary and explaining very well what contextual banking means. Unfortunately or fortunately for some the tech and crypto world are changing very fast, some can adapt to it or be left behind. I try very hard to keep up with this fast moving world but sometimes I wish the old simple face to face method still existed.

  29. The technologies are moving toward us with an enormous speed. It’s hard to keep up with it these days!
    I didn’t know that contextual banking was so close, probably just around the corner in some parts of the world…?
    Wish I had more time to learn and educate myself about them..

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