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PLATFORMIFICATION
Towards a new era in platformification
It’s an ugly word but behind its façade lie some of the more important trends of this year. The challenge is arriving at a common definition of what a platform is. We went seeking new insights from those faced with this new conundrum
Senior Editor Bill Boyle
D
espite its relatively recent usage in the world of banking, the concept of platformification as a business model has been around for many years, but it is fast becoming the most
significant trend of 2018. At its purest, platformification is the process whereby both existing banks and startups begin a strategic shift towards becoming banking platforms, in the same way that Amazon is a platform in the retail sector.
At its core, platformification is merely a new type of business model for banks. A platform is a plug-and-play business model that allows multiple participants, both creators and consumers to connect, interact with each other and create value. To be considered a platform it must enable participants to quickly engage – and disengage, something which partnerships alone typically do not do.
Hugh Cumming, CTO platforms, Finastra says: “As the customer pushes the banks for ever more complex services, in real time on their mobiles, in the UK we have to meet some strict regulatory needs. We are overcoming significant challenges bringing these solutions to our 10,000 bank customers across many platforms. Our strength is our ability to provide access to our FusionFabric Cloud using IBM’s Icloud offering as a gateway.”
Hugh Cumming: the UK has to meet strict regulatory needs
Today’s banks are good at attracting consumers but there is practically no focus on attracting other producers, other than the one-off partnerships that a bank normally pursues. The key to successful matchmaking on a platform is matching a consumer to one (or more) providers. Banks usually match customers with just one provider’s products – the bank’s. Today’s banks don’t have a magic box of solutions. Banks have a bad track record of integrating products and solutions of their partners, let alone providing the ability to plug-and-play.
At its regional flagship thought leadership event, Finastra Universe Paris, Finastra welcomed new companies to its
FusionFabric.cloud open
architecture. Among the early adopter fintechs, consultants, banks and academics using their platform to develop and deploy innovative apps are Efficiency MC, Conpend and BankBI.
Conpend’s CEO, Marc Smith, says: “In essence, platformification enables the knitting together of a host of isolated back-end systems into a single platform that we can plug into and where what the customer sees is a large menu of apps to choose from lots of suppliers. We have been able to expand our market by moving into markets such as lending that we were not in before, so it has added value to our company.
www.ibsintelligence.com | © IBS Intelligence 2018
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