While experts agree about the critical role banks play in a thriving economic system, many also think more can be done to go beyond this fundamental role and embed delivering social value into the core business of banks.
These views were expressed in a new report released by the Center for Responsible Business at the Haas School of Business, University of California-Berkeley and research consultancy GlobeScan who interviewed 60 experts inside and outside the financial services industry to explore how the industry will evolve over the next decade.
Based on the expert opinions we heard, the report concluded that three potential scenarios for the future of the sector exist:
One of the major innovation opportunities identified by experts is financial inclusion--addressing the world's 2.5 billion un- or under-banked adults. Underscoring Citi's industry-leading initiatives in this space, study respondent Bob Annibale, Citi's Global Head of Microfinance and Community Development, highlighted the importance of engaging with players traditionally outside of the financial services sector including NGOs: "Although Citi has a local presence in over 100 countries, we often have a limited branch footprint in terms of reaching many underserved consumers in rural and urban areas. However, we do have rela¬tionships with partners, non-profits, and for-profit institutions, which have a presence that may extend 'the last mile,' and by combining our resources we can expand and accelerate financial inclusion."
Besides financial inclusion, experts see potential for financial services companies to leverage their expertise and build on existing efforts to deliver social benefits through:
Clearly "inclusive innovation" opportunities exist and are already being implemented by many financial institutions; however, the question still remains: how to bring these often relatively small, side-lined, pilot or one-off initiatives to scale. If financial institutions are to realize these oppor¬tunities, they will need to address a perceived gap between their current level of engagement with civil society and what many thought leaders regard as the optimum level for the future.
We are grateful to Citi, one of five leading financial services firms to provide financial and intellectual support to the independent report, for its longstanding efforts toward expanding financial inclusion. It is critical that Citi and other financial services firms continue to heavily invest time and resources in these efforts.
To read the complete Future of Finance report, visit https://responsiblebusiness.haas.berkeley.edu/.