Pertes & profits. Money has no borders, but banks do. Curiously, this profession so internationalized for professionals has never really succeeded in speaking foreign languages, since it is aimed at individuals. The British establishment HSBC, which is in the process of winding up one of the few global networks in the sector, is there to attest to this. Especially since the current low interest rate environment makes this business very unattractive.
This is why it will be necessary to follow with attention the landing of JPMorgan Chase in Great Britain, because it contains a novelty. In the holds of its barges, its new soldiers are robots. They don’t have the familiar face of Star Wars androids, but the elusive face of an algorithm. The first American bank announced, Thursday, June 17, the takeover of the small company Nutmeg, a London start-up specializing in wealth management. “We are not hiding behind complicated price lists and incomprehensible jargon”, proclaims the site. In short, we are not humans.
Robots vs. robots
Account management is moving at high speed on the Internet, investment advice now follows. Nutmeg robots advise 140,000 clients, while the firm, created in 2011, employs only 150 people. The American banking colossus, which has just launched its Chase brand in the United Kingdom, wants to increase this customer base tenfold, the only condition for profitability. He will not be the only one, since his compatriot Goldman Sachs intends to do the same with Marcus Invest, his own machine for advising individuals.
Until now, the establishment of a bank in a country involved the acquisition of a local competitor. As HSBC had done in France, with the acquisition of Crédit commercial de France in 2005. The financial and human cost was significant. Now, all you have to do is afford a fintech, these financial start-ups that abound across the continent. Will this be enough? The specialists raise two problems. First, that of acquiring customers. Robots might be good advisers, but they’re not good traders. Marketing expenses are significant and the trust issue is enormous.
Finally, we still need humans at the end of the chain to solve the 20% of complex cases that are not understood by the machine, or just to reassure the customer. Bank branches will lose their last raison d’être. With an unforeseen consequence. Old-fashioned heists are giving way to the explosion of cybercrime. Robots versus robots.