In 2022’s downturn, many fintech firms are having to clip their wings. During the past few months, Coinbase, Gemini, Klarna, PayPal, Robinhood and more have been laying off staff, cutting costs and facing the first recession their firms have had to deal with. Meanwhile, the older firms with a great history are managing not to do this. In fact, the best place to work in financial technology today might be with a big old bank.
For example, in a presentation in June 2022, Goldman Sachs’s president and chief operations officer, John Waldron, stated that the bank’s plan is to make more than $4bn from its consumer banking business (Marcus) and more than $750m in revenues from its transaction banking platform (TxB) by 2024. A month before, Jamie Dimon, CEO and chair of JPMorgan, made clear that the American bank is investing in new technology projects to the tune of $14bn — half of which is to run the bank and half to change the bank.
I remember talking with some bankers about this, and they told me that banks are a good place to work as a technologist as you can rapidly make a difference by developing their apps and application programming interfaces, delivering new tools and capabilities, and challenging and changing the old structures just by being a good coder.
Today’s banking industry is a tech industry, and it needs coders and developers to create the rails of finance
The resistance to this, of course, is that if I am a good coder, why would I want to work with a big old bank with old technology? I would want to work with something cool and new, not something big and old. I want to work with rainbow-coloured companies with open office rules, a drinks bar, a playroom and an allowance to be LBTQ+ without question. A big old bank does not appear that way — or does it?
Great strides
Interestingly, over the past few years, many banks have made progress in diversity and inclusion. We are not there yet but, when you look at the stats, we are changing. For example, the Bank of England’s 2021 diversity report shows that one in five people in key roles in banks are now female. That’s not great, but it’s a lot better than 2001, when it was fewer than one in 10.
This does not mean that banks are completely in the clear — the numbers are still too low — but there is improvement.
For me, this means that the industry I joined years ago, with its suits, ties and bowler hats, has changed. Today’s banking industry is a tech industry, and it needs coders and developers to create the rails of finance. It is an industry that has seen the rise of the alternatives and recognised that it had to change too.
Today, a bank is not a boring old incumbent. It’s a place where the young can hang out, have their toys and play their games — as long as they are delivering the code that ultimately fulfils the needs of the customer. However, primarily, it’s a place that is still strong and stable, unlike some of the young bright things that will go under during their first recession.
For companies that have always found funding freely available, markets growing and easy hiring, fintech’s biggest challenge is coming today. For companies that have been around for 100 years or more, and have seen many recessions or even depressions, the greatest opportunity today is right now. Banks should be actively seeking to hire the best coders and developers as they are being let go by fintechs.
Does that mean a traditional bank is now cool? Not really, but at least banks are no long boring.
