The financial system will need to be a platform that federates existing players (such as banks) and new players (such as telecommunication companies… )
1) bitcoin-inspired distributed systems
2) open APIs (application programming interface) as a new way to consumer business services on the internet
3) crowd-sourced identity schemes
4) open source hardware and applications

How can the traditional industry players prepare for such changes? How can we leverage these changes to make low cost, secure and reliable financial services available for everyone on the planet?

Is the traditional consumer financial system, based on bank accounts, in the same situation today? Are we in the age of “vacuum tube financial services”, with the transistor right beyond the next hill?

Let’s first consider a number of changes that can be observed on the way people perceive and use financial services. Technology has so far made it possible to accelerate the pace and volume of transactions, but it has not transformed the relationship between the industry and its customers in the same way as it has in, say, publishing (from books to e-books), movies (from DVD to mp4), or popular music (from CD to mp3 to streaming).

__FIRST: next generation of consumers
Instead of technology being used to hold them captive, they expect service providers to use technology to empower them to determine not only how services will be provided, but what services will be provided.

__SECOND: The second change comes from the estimated 2+ billion people who today have no access to financial services, and resort to cash for all transactions. On the other hand, a large majority of them have a mobile phone, a very powerful instrument of not just communication, but also inclusion.
This explains why the telecommunication companies are increasingly seen as instrumental in making financial services available to the unbanked.
__THIRD: The last change comes in the way we access and consume financial services. The smartphones and especially tablets have simplified this considerably, but most of us are still facing a different app for each service provider, while what we really want is to have a seamless and integrated view of our financial assets. One identity, one user interface for all service providers.

In other words, another way to look at Facebook (or LinkedIn and other major social networks) is as a trusted identity system.

How can we then envision a financial system that rides the wave of change, and leverages the technological innovations we have reviewed above? I think about this from the perspective of the billions of unbanked, and the next billion of hyper-connected individuals that will be the customers of tomorrow. The financial system will need to be a platform that federates existing players (such as banks) and new players (such as telecommunication companies and other information technology companies) that will:

_ONE: Be accessible safely and reliably from connected devices, from feature phones to smartphones to other specialized (wearable?) devices
_TWO: Enable new customers to be connected seamlessly, using a crowdsourced and flexible “know your customer” system
_THREE: Enable customers to own their accounts, and operate them themselves or choose freely who to contract to operate it for them
_FOUR: Be based on open APIs so new service providers (payments, insurances, loans, etc.) can be connected and discovered easily
Be based on open APIs so customers can freely choose how to combine the services on the platform in new ways that suit them
_FIVE: In addition, the platform should be available in open source – so that it can be permanently refined and built upon, as a common asset of the humanity.