WEBVTT - Quick Bite: How does the future of banking look? 

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<v Speaker 1>You're listening to A Shares these podcast.

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<v Speaker 2>And so let's kind of turn our minds to open

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<v Speaker 2>banking and neo banking. We've seen success in the UK

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<v Speaker 2>and Australia where customers are able to be too more

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<v Speaker 2>easily switch banks or be offered more competitive services and

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<v Speaker 2>products from third party financial companies. But how has A

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<v Speaker 2>and Z approached adopting open banking and tech in Australia

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<v Speaker 2>and will we be taking the same approach here in

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<v Speaker 2>New Zealand.

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<v Speaker 1>So actually, the neo banking thing has largely been a

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<v Speaker 1>failure and I think we should just call it as

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<v Speaker 1>it is. I mean, most of the neo banks who

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<v Speaker 1>started here in Australia have subsequently closed or been a

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<v Speaker 1>quiet yeah. And the reason for that, and again on

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<v Speaker 1>being overly critical probably and overly a bit unfair, is

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<v Speaker 1>because they didn't there's nothing neo about what they're offering

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<v Speaker 1>was to a customer, there was nothing new. They still

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<v Speaker 1>took deposits and made light and you know large Okay,

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<v Speaker 1>the act was a bit sexier, and you know there

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<v Speaker 1>were some nice features around it, but the fundamental proposition

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<v Speaker 1>was the same.

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<v Speaker 3>Right.

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<v Speaker 1>In fact, you could argue it was worse because they

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<v Speaker 1>didn't have the breadth of service as a big bank had,

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<v Speaker 1>and really importantly, they didn't have the stability that a

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<v Speaker 1>big bank hats. Yeah in terms of the credit quality

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<v Speaker 1>and the diversification benefits that we had. So I and

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<v Speaker 1>that doesn't mean we should ignore technology. But where the

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<v Speaker 1>really profound change hasn't been neo banking per se, has

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<v Speaker 1>been real innovation, which is truly new proposition. So whether

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<v Speaker 1>it's a revolute or wise or the way that or

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<v Speaker 1>bone now po later on those sorts of things, so

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<v Speaker 1>different ways of engaging with your financials, right, those are

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<v Speaker 1>really where the innovation has come. Now. The challenges on

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<v Speaker 1>a big bank is how do you engineer yourself to

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<v Speaker 1>have the best of both big, stable, diverse and innovative,

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<v Speaker 1>fast clever propositions. Well that's our strategy. That's why with

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<v Speaker 1>launched d A m Z plus our new retail platform, which

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<v Speaker 1>is we've got roundups too. But we're the only major

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<v Speaker 1>bank who can do it because we've built ourselves in

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<v Speaker 1>a modern, contemporary stack. Now, everybody criticized us for doing

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<v Speaker 1>it because a cost a gazillion dollars, cost a lot

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<v Speaker 1>of money to do, but once you get there, what

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<v Speaker 1>we're seeing today's the advantage. We're only two years in market.

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<v Speaker 1>The cost to service a customer on Plus is thirty

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<v Speaker 1>five percent lower than it is in our traditional bank now.

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<v Speaker 1>A year ago it was twenty percent lower. So it's

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<v Speaker 1>getting the gaps widening. So that's our future. I think

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<v Speaker 1>the future is all about how do we embrace new technology,

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<v Speaker 1>So we use open banking and Plus. Using open banking,

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<v Speaker 1>you can go in and you can import your balances

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<v Speaker 1>and transactions to view them from one hundred and ten

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<v Speaker 1>other banks in Australia, any of them, and see it

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<v Speaker 1>all and see your consolidated financials. That's really really cool.

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<v Speaker 1>Now we're the only major bank that does that as well,

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<v Speaker 1>because we've invested in the technology stack that allows it.

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<v Speaker 2>I read someth with it. About seven percent of the

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<v Speaker 2>A and Z code written last year was generated by AI.

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<v Speaker 2>I think it's hub copilot. Can you tell us a

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<v Speaker 2>bit about how you envision AI technology changed it the

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<v Speaker 2>operational nature of A and Z and also the banking

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<v Speaker 2>industry as a whole.

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<v Speaker 1>I spent a bit of time up in California recently,

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<v Speaker 1>and the future is as generative AI and I know

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<v Speaker 1>probably people are sick of hearing about it, and there's

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<v Speaker 1>no doubt there's an element of overhype. That's true in

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<v Speaker 1>any new technology. But I've seen that future, and the

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<v Speaker 1>future is going to come in two ways. All of

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<v Speaker 1>the banks, we'll all everybody will start using these co

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<v Speaker 1>pilots that are embedded in every single tech tool we have,

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<v Speaker 1>Microsoft Outlook, it will be in Salesforce, it will be

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<v Speaker 1>into every tech tool we have your phone, and they'll

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<v Speaker 1>be great, and they'll make us all more efficient, just

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<v Speaker 1>like email made us all more efficient. But the benefits

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<v Speaker 1>of that won't differentiate you. They'll all get competed away

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<v Speaker 1>for the benefit of customers, but you still have to

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<v Speaker 1>do it great. The real opportunity is how do you

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<v Speaker 1>then take those AI tools and intelligent automation that comes

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<v Speaker 1>with it advanced analytics and embed those in propositions. Yeah,

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<v Speaker 1>so imagine if on your an SID plus you had

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<v Speaker 1>a virtual personal banker who you can ask questions of.

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<v Speaker 1>Am I going to be able to for to go

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<v Speaker 1>on holiday this year? Tell me where my money went

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<v Speaker 1>last month? Talk to me about am I saving enough

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<v Speaker 1>to form my retirement? All the banks will do the

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<v Speaker 1>productivity stuff, contact centers, all that some who have the

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<v Speaker 1>right tech platforms, we're able to build better propositions and

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<v Speaker 1>that's obviously where we aspire to be. In Australia and

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<v Speaker 1>in New Zealand.

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<v Speaker 3>Investing involves the risk you might lose the money you

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<v Speaker 3>start with. We recommend talking to a licensed financial advisor.

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<v Speaker 3>We also recommend reading product disclosure documents before deciding to invest.

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<v Speaker 2>Italian summer, buying a house, new granny flat. Whatever your aspirations,

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<v Speaker 2>we can help you get there, not just with investing,

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<v Speaker 2>but now with a high interest flexible savings account and

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<v Speaker 2>a key we save a scheme too, SHARE's ease for

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<v Speaker 2>the money you've got big plans for