To See the Future of Banking, One Should Look to China, Says Bank Leumi Exec

Within a decade, some banks will become an operational entity, as is already happening in China, Dror Topf, head of group strategy and innovation at Israel’s Bank Leumi, said Monday. Speaking at Calcalist and Leumi’s Mind the Tech conference in Tel Aviv, Topf explained that Chinese consumers use apps like WeChat for everything, from ordering a taxi or setting up a doctor’s appointment, to paying at a restaurant. “These apps let you pay directly from your checking account or take out a loan, and are connected to several banks based on a tender.”

The entrance of non-banking entities like Google and Apple to the financial industry does not mean traditional banks will disappear, but rather that they need to figure out how to better operate in today’s reality and appeal to today’s consumers, perhaps leading to newbanking models, Topf said. Companies like Google toe the line and partner with banks because they do not want to shoulder the regulation and supervision Banks are subject to, so banks will always have a role to play, he said. People should also consider that while banks are supervised and are compelled by the law to protect user data, non-banking players can use the data generated by users for various applications.