The document discusses the future of banking and invisible banking platforms. It notes that disruptive forces are shaping the banking industry, including fintech startups, changing customer expectations, and increased regulatory requirements. It then discusses different business models for banking platforms, including the bank as producer, distributor, and marketplace. It provides examples of how these models could work and the types of capabilities and functions involved. The document advocates for connected banking ecosystems and provides examples of blockchain-based financing projects and an agriculture platform in India.

1. The Future of Banking is Invisible
1
Bharat Bhushan
IBM Distinguished Engineer
CTO, Banking and Financial Markets (EMEA)
bharat.bhushan@uk.ibm.com | @_bharat_
The Future of Banking

2. 2
Disruptive forces
are shaping the
banking and financial
markets industry
Disruption from
the FinTechs
Expanded risks
for security and
fraud
2
Shareholder
demands
for improved
returns
Changing
customer
behavior and
expectations
Heightened
regulatory
compliance
burden
Digital
disruption from
Tech giants

3. Banking Platform Business Models
The business case for Industry Platforms is clear: to be successful in the “disruptive” marketplace, banks will need
strategies & business models that provide differentiation and drive client value
Open Payments (Payment
Initiation)
Open Banking (Account
Aggregation)
Bank as Producer Bank as Distributor Bank as a Marketplace
Description
Third Party Partners (Fintechs
and others) use directly exposed
Payments APIs
Bank provides APIs for Clients
and Partners (for Bank’s
Business Units, it’s possible as
well) for a broad number of
services
Bank’s products and services
sold by 3rd parties (resellers)
Bank sells their own products
and resell those of other Third
Parties (fintechs and others)
Bank connects offer and
demand, integrating (as an
option) their own products as
well as non banking 3rd
parties
Illustrative
Business
Capabilities
• Partner onboarding
• Operational Risk assessment
and monitoring
• Partner onboarding
• Client API onboarding
• Billing API consumption
• 360 Degree view of client
• Third Party’s client
onboarding
• KYC
• Bank product offering
• Product fulfilment
• Operational Risk
assessment and
monitoring
• Credit Risk (for loans)
• Client onboarding
• KYC
• 3rd Party Partner
onboarding
• Third Party product
onboarding & mgmt.
• Operational Risk
assessment and
monitoring
• Fees billing
• Producer onboarding
• Client onboarding
• Partner onboarding
• Client (ask) & Producer
(bid) matching
• Sales management
• Delivery Management
• Fees billing
• Segmented marketplaces
Examples
Bank
Functions
Third
Party
Functions
Bank
Products
APIs
Partners,
Clients
Payments
and Account
info
APIs
Partners
Clients
Bank
Products
APIs
3rd Party Distribution
Channels
3rd Party
APIs
Clients
3rd Party
Products
Bank Channels
3rd Party
APIs
Clients
Bank
Products
APIs
3rd Party
Products
APIs
Marketplace
3rd Party
APIs
Clients Producers
Bank
Products
• Producers
• Clients
• Partners

4. Read more details at https://www.ibm.com/blogs/research/2018/12/hello-tractor/

5. Blockchain-based
microfinancing
5
220 small food vendors
receiving microloans across Kenya
Financing system
based on blockchain
Logistics platform for kiosks
and food stalls in Africa
Twiga foods working in partnership
with IBM Research

6. 6
From disconnected and fragmented value chains…
Ecosystem Partner
Company
Farmer
• Access to larger market
• Leverage technology to scale rapidly
• Farmer insights
• Preferred Service Provider
• Enhanced Market Share and service capability
• Bundling of products
• First mover advantage
• Digital loyalty management via wallets
• Better farm yield
• Informed decisions
• Single reliable source for product/services
Farm
Equipment
Advisory
Services
Live Mandi
Seeds/
Fertilizers
Financing
Farmer
Logistics
…To a connected and synergetic ecosystem
Farm
Equipment
Advisory
Services
Live Mandi
Seeds/
Fertilizers
Financing
Farmer
Agriculture
Platform
Logistics
Backed
by digital
wallet
Baroda Kisan: A Vision for Farmer Ecosystem

7. 7
See more details at https://www.ibm.com/events/think/watch/replay/126550664/

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13. Functional Reference Architecture
13
Identity, Access and SCA Engine
HSM
Developer Portal
KPI Dashboard
Notification Gateways
Mobile App SDK
Fraud Engine
Case Mgmt
SIM Swap
Check
Dispute Management
Contact Centre & Branches
Open Banking
Directories
eIDAS Registries
Payment /
Consent
Mobile Networks
Payment Schemes
ESB/ Orchestration Layer
Security Gateway
CRM
Regulators
Call back Services
Outside of the bank
Within
the
bank
Third Party Providers
Reverse Proxy, CDN, Network & DoS Protection
Data
MicroServices
Experience
MicroServices
Firewalls and Network Load Balancers
SaaS Offerings
Data
Cache
Partners
eBanking
Partners
Core Applications and System of Record
ZoS
Connect

14. Incubation Area
Production Area
Data-Centric Components
DevOps
Operations & Monitoring
Customers
Data Sources
Data Engineers
Data Scientists
14

15. Replace this with the
latest version with
whiteboard
15

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19. 19
https://www.ibm.com/uk-en/cloud/cloud-pak-for-integration

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