Bipin Sahni, Wells Fargo’s head of innovation research and development for its innovation group, talks to Joy Macknight about laying the foundation for innovation through an R&D mindset.  

Bipin Sahni

The new ways in which data is being used to individualise banking products is the hottest space that Bipin Sahni, executive vice-president, head of innovation research and development (R&D) in Wells Fargo’s innovation group, is currently looking at.

“If I can understand a customer and can personalise their experience, and every other individual user’s, then it is a winning bet,” he says. “It means that I know the customer well, their behaviour, how they use our instruments, and I can deliver a more seamless and frictionless experience – effectively, invisible banking.”

The US bank’s goal is to build a next-generation experience that caters to all customer segments. “We want to embed our capabilities in such a fashion that it is one app, but when I log in I have a different experience than when a student logs in – and that is dependent on data,” adds Mr Sahni.

Improved customer experience is where fintech start-ups and neobanks have initially been more successful than incumbents. “The challenger banks, for example, have done a good job in leveraging data that is available to them and building an experience that is more fluid,” says Mr Sahni. “But we are learning from, investing in and collaborating with fintechs.”

Accelerating innovation

Wells Fargo created the innovation group in October 2016 as a shared enterprise across all lines of business. It has also created several ecosystems, such as digital, payments, innovation and data, which helps innovation stay connected across the bank.

As part of the innovation group, Mr Sahni’s main aim is to find new technologies that will help the bank’s customers. But leading the 50-strong R&D team also allows him latitude to try new experiences and innovations that may not purely align with financial services today but might in the future.

Career history: Bipin Sahni  

  • 2015 Wells Fargo, executive vice-president, head of innovation R&D, innovation group
  • 2012 Wells Fargo, senior vice-president (SVP), head of innovation and R&D, wholesale services group
  • 2007 Wells Fargo, SVP, technology development area manager, wholesale technology group
  • 2003 Wells Fargo, vice-president, technology development

In 2014, he was instrumental in creating Wells Fargo’s start-up accelerator programme. “Personally, I love the disruptions happening everywhere because it creates the perfect environment for companies to connect with us. As these companies evolve and develop new ideas, we want to leverage those solutions to better serve our customers,” he says.

The programme is a virtual, non-exclusive global accelerator and the lines of business are involved in the selection process, which includes multiple levels of review from both business and technology perspectives. Then the start-up must pitch its solution to the investment committee. “If the fintech has a line of business wanting to use the solution, then it is a no-brainer for us to agree to invest,” he says.

At the beginning, the bank allocated up to $500,000 for each participating company, but has since increased investment to $1m. “We aren’t investing to make money but to gain access to innovation, which differentiates us from many other accelerators,” says Mr Sahni. The start-ups also benefit as, in addition to getting seed capital, Wells Fargo could potentially become a partner.

Whereas previously the bank accepted applications twice a year, now the six-month programme is kept open. Today, there are 19 companies in the accelerator and some have gone on to raise money from other banks, which Mr Sahni sees as a validation of the areas that the bank is looking at, such as biometric authentication and cyber security.

And the pipeline is well developed. He reports that Wells Fargo has built its connections via numerous channels, including other banks globally that have built up their own successful accelerator programmes. “The whole ecosystem effect is now taking shape. It took a while but we are starting to see the value of what we have created,” says Mr Sahni.

Lessons learned

While Wells Fargo’s policy is not to sit on a fintech’s advisory board because it wants to “leverage what they are good at and not force ourselves on them”, according to Mr Sahni, its fintech partners are having an influence on the bank, teaching it to be nimbler.

For example, when Wells Fargo first invited a few start-ups to do proofs of concept (PoCs), the technology group – which usually deals with large consultants and IT organisations – wanted to embed the teams into the bank without considering the feasibility. “A start-up may have two or four people, so we don’t want all four working here because that isn’t in the start-up’s best interest. That was an important lesson,” says Mr Sahni. The bank has also shortened the timeline to move from a PoC into pilot mode.

Speed to market in another focus for the bank and an area where the R&D team acts as catalyst. “As we make large investments in these projects, we dedicate resources and use agile methodology to roll them out,” says Mr Sahni.

The team’s role is also to broadly define a culture of innovation in the bank. Mr Sahni adds: “If, in five to seven years, the lines of business have embedded innovation, and are evolving with it, then the bank will no longer need a separate R&D team.” Nevertheless, he sees great value in an R&D approach.

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