Sibos 2024: The evolution of connectivity and preparing for what’s next
In 2020, the world was taught an important lesson about the value of being connected.
Companies cannot prepare for the future by focusing on one technology alone
Isolated in our homes due to Covid, for the majority, it was only through technology that we were able to continue to work. As more people were compelled to use online services, those companies that did not have any or had poor online services were equally compelled to improve them.
Now we have experienced the usefulness of AI, many companies are scrambling to leverage its power to avoid being left behind or disadvantaged. And in 2024, many businesses across the globe were taught another important lesson by the CrowdStrike outage, which impacted several segments of financial services. For banks in the EU, even before the CrowdStrike incident, many have been preparing their cloud systems to cope with potential outages better due to the introduction of the Digital Operational Resilience Act (DORA).
The future of connectivity
Our future world is one that is increasingly connected. Whether for work, to socialise, to learn, for entertainment or for pleasure, increasingly we are not only spending more time connected, we are also becoming reliant on our connection.
However, how we are connected is also changing, and moving forward, this will begin to shape all businesses – not only banking. With increasing resilience and increasing bandwidth, our connections will always be on, rather than just connecting when we choose to. To some extent, we have already experienced this with mobile alerts and smart devices giving us constant feedback on our health and wellbeing. As we expect everything to be available online, we will expect everything to be real time and always available.
For example, many countries have implemented faster payments, which in some cases has taken days out of the time it previously took to receive money. Similarly, international transfers for many countries can also be done within seconds or minutes through services like Wise, while many banks still take days. Going forward, as cash is digitised fully, we will expect instant transfers to anyone globally. Just as we have experienced with taxis through Uber, increasingly, payments will be embedded in everyday customer journeys rather than needing separate payment steps, further removing the need for cards or cash.
Another change will be increased streaming of data in real time. Today, we only really experience this in trading or gambling, where the timing of updates to prices is crucial. Increasingly, we also see our health data being streamed in real time also – this is already possible for things like diabetes and heart conditions. To enable this, we have smart devices that are always connected and which update in real time.
So, it is not only people, but devices that will constantly be connected and streaming data. It is estimated that there are 15 billion devices connected today (5 billion in China alone) and that there will be 30 billion connected by 2030. With increasing miniaturisation and longer battery lives, almost anything and everything could be connected and streaming data in the near future.
With AI chips and the evolution of quantum computing, our ability to compute at scale will increase massively. Again, this presents the potential for new capabilities we previously never thought possible. For example, calculating the cost of running your home could become far more accurate and predictable by leveraging streaming data from utilities, weather and other feeds. “Health data” from appliances streaming their operational status could provide a view on when they may need repair or replacement. With your permission, some of your home data could automatically be traded to provide income or discounts from competing suppliers.
Preparing for what’s next
Companies cannot prepare for the future by focusing on one technology alone. The sum of these changes presents a very different opportunity to what each can provide individually.
This raises a number of questions for all companies: how will these changes affect your business? What new opportunities will these changes create? How can we operate better in light of these changes? It may not be possible to predict the impact of these changes and answer these questions now.
However, it is imperative that companies put in place updates to their existing systems now. Aside from improving the resilience of systems, businesses also have to prepare systems to operate in real time and be scalable as they move from simply transacting data to streaming it constantly. As the rate of technology change and customer adoption increases, so does the need for companies to increase the agility and flexibility of their systems to keep pace.
When it comes to the future, it is easy to say that thinking let alone planning too far out is a waste of time, because so much can change between now and then. We are not in the same situation as we have been used to in the past. Software is critical to every enterprise and change is moving faster than ever before. As such, this is not the time to wait and see. This is the time for planning and action, because we already have the foresight to understand much about what is about to unfold.
About the author
Dharmesh Mistry has been in banking for more than 30 years both in senior positions at Tier 1 banks and as a serial entrepreneur. He has been at the forefront of banking technology and innovation, from the very first internet and mobile banking apps to artificial intelligence (AI) and virtual reality (VR).
He has been on both sides of the fence and he’s not afraid to share his opinions. All opinions are his own – feel free to debate and comment below!
He founded proptech start-up AskHomey (sold to a private investor in spring 2023) and is an investor and mentor in proptech and fintech. He also co-hosts the Demystify Podcast.
Follow Dharmesh on X @dharmeshmistry and LinkedIn.
Read all his “I’m just saying” musings here.
