The future of banking and finance will be in fintech. So, what are fintechs looking for when they hire new staff? And what’s it like working for a fintech?
At some point, there will be no sharp line between financial services firms and technology companies. All financial firms will be fintechs to a greater or lesser degree.
The shift is already well underway. JPMorgan, for example, recently announced that it will spend US$12bn on fintech investments this year.
Fintechs can react to customer needs more quickly and at lower cost than traditional, incumbent banks – partly thanks to the rise of cloud-native core banking technology.
But if you‘re interested in starting a career in the finance sector, or already have a background in legacy commercial or retail banking, that doesn’t mean you have to learn to code.
Automation in financial services
Even the most hands-on roles in financial services will soon have more automation. But the machines won’t take over.
Take for example, regulated advice. A poll of financial advisers at one of our webinars found that none of the participants expected the role of human advisers to disappear. The majority expected more complex work for human advisers alongside automated advice provision.
The wholesale shift to digital during Covid lockdowns increased the pressure on existing large banks. Jeremy Takle is the Co-founder and Chief Executive of Pennyworth, a start-up bank that aims to “help busy people reach their goals”. He says the incumbents face a unique challenge.
“It’s true that banks have to deal with a lot of regulation, but a bigger burden is the industrial legacies at large banks that have 19th century branch networks and 20th century technology,” says Takle.
“They are competing with fintechs that are mission-driven and operating in agile cycles with very clear information.”
Why join a fintech?
Takle says that a that “a lot of people” are leaving large banking organisations for start-ups – even though they will be paid less – because the smaller firms are much more mission-orientated.
That mission is about making sure that the customer is happy.
What Takle is looking for is people who share the company’s customer-focused sense of purpose and will work hard to realise it.
“We have a rule at Pennyworth, of no jerks and no free-riders,” says Takle.
“We’d rather have someone who wants to collaborate and get on with things, and is talented enough, than a self-centred star.”
How fintechs are managed
Fundamentally, banks exist to manage risk, which is why they are closely regulated. That might suggest that banks need to be very rigid in terms of how they manage staff. Takle sees it differently.
“A lot of risk management in banks can be reduced to models,” says Takle. “But most uncertainties are not reducible to probabilistic solutions, which is why you need an organic and adaptive operating model.”
He points out that senior managers can’t get into the minutiae of tasks. “They have to figure out the ‘what and why’ and then enable teams, that are essentially small businesses solving the how, and scale through that.”.
Going to a fintech won’t necessarily make you rich. But it might make you more engaged with your career.
“Remuneration is important in almost any career but, essentially, people are motivated by more fundamental things – such as do they have a purpose and are they given the freedom to think and problem-solve?” says Takle.
That, he says, is how the most successful firms operate.
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