One of Deutsche Bank’s most senior executives said that bank accounts could be obsolete within 15 years.
Marcus Schenck, Deutsche’s co-head of corporate and investment banking, said that a recent trip to China had opened his eyes to the fact that the retail banking sector is rife for disruption,
“There’s a thesis that at some stage in 5, 10, 15, 20 years — who knows — accounts will disappear, and be replaced,” he said.
Marcus Schenck, one of the most senior executives at Deutsche Bank, believes that bank accounts as we know them now could disappear in as little as five years.
Schenck, who is co-head of corporate and investment banking at the German lender, told Bloomberg’s European Capital Markets Forum that a recent trip to China had opened his eyes to the fact that the retail banking sector is ripe for disruption from new technologies.
Asked by an audience member how he and fellow panel members — Barclays CEO Jes Staley and Societe General Chairman Lorenzo Bini Smaghi — were preparing for technological disruption, Schenck told an anecdote about visiting a company manufacturing computer chips.
“The week before last I was in China, and saw a company that is producing microchips that are used for bitcoin mining, or any type of blockchain technology,” he said.
“There’s a thesis that at some stage in 5, 10, 15, 20 years — who knows — accounts will disappear, and be replaced.”
“That would be a game changer to what we’re doing,” Schenck said, adding that financial firms “have to monitor what’s happening.”
Schenck’s argument concerns the creation of individual wallets for cryptocurrencies — whereby people are able to store their money digitally but without the need for a third party like a bank. Bitcoin and other cryptocurrency wallets are already widespread, but many believe their usage could spread even more rapidly in the future as cryptocurrencies themselves are more widely used.
“Technology is impacting the different businesses we are operating in in different ways,” Schenck said, noting that in retail banking “there is a completely new normal evolving.”
“The vast majority of activities are going down the path of being a more electronic interaction with your client. We have that in our trading business, in FX. The vast majority today, there are no human beings involved when we do business,” he added.
As well as changing the way banks themselves operate, technological advances in the financial sector are also changing the skills that people looking to work in the industry need to possess to get ahead.
“I don’t think we’re far away from saying that whoever wants to works in a bank, better speak English, and better be able to code,” Schenck said.
“Being able to code, I think, will be as relevant as being able to speak English.”
Later in the same event, Schenck’s advice on what skills are needed in the modern world were directly contradicted by Bloomberg founder and CEO, Michael Bloomberg, who said that jobseekers are far better served learning Mandarin, enabling them to do business in China, than they are coding.
That’s because the level of coding that most normal people will be able to learn will be automated in the near future, Bloomberg said, while speaking a language can never be truly digitised.