WEBVTT - Pershing's Nagappan on Fintech: Disruptive vs. Enhancing(Audio)

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<v Speaker 1>Global business news twenty four hours a day. If Bloomberg

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<v Speaker 1>This is a Bloomberg business flag from Bloomberg World Headquarters,

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<v Speaker 1>Signed Charlie Pellett. Just getting word from GAP that it's

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<v Speaker 1>July comp sales down four percent. Estimates were for a

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<v Speaker 1>drop of one percent. Lending Club's loss widened to eighty

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<v Speaker 1>one point four million in the second quarter as the

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<v Speaker 1>online loan ventures sought to contain damage from a surprise

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<v Speaker 1>leadership change in May. The company also expanded that shake up,

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<v Speaker 1>replacing its chief financial officer. Stocks lower SMP five hundred

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<v Speaker 1>index dropping two points a little change, down one tenth

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<v Speaker 1>of one percent. Down. Industrial is also down one tenth

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<v Speaker 1>of one percent, falling fourteen points to eighteen thousand, five hundred,

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<v Speaker 1>twenty nine, Gold down three forty anounced the thirteen thirty

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<v Speaker 1>six and drop there of three tenths of one percent,

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<v Speaker 1>and crude Oil West Texas Intermediate up two and a

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<v Speaker 1>half percent of one oh six and barrel to eight six.

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<v Speaker 1>I'm Charlie Pelts, and that's a Bloomberg Business flash. It

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<v Speaker 1>is is taking stoff with Kathleen Hayes on Bloomberg Radio.

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<v Speaker 1>I think that financial technology innovation only comes from companies

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<v Speaker 1>whose names you've never heard of. Not true. Joining us now,

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<v Speaker 1>Ram Nagapon. He is the chief information officer for Pershing.

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<v Speaker 1>They're based in Jersey City, New Jersey, and he's here

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<v Speaker 1>to tell us more about the challenges and the opportunities

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<v Speaker 1>in fintech. Rom It's always a pleasure. Thank you very

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<v Speaker 1>much for coming in. How do you describe fintech to

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<v Speaker 1>people that say, all right, I understand financial and I

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<v Speaker 1>understand technology, but what's the big deal about putting them together?

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<v Speaker 1>Tell us about it. Okay, thank you for having me here,

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<v Speaker 1>so then talk about fintech. There are two things that

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<v Speaker 1>I'm going to tell you. One is there are companies

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<v Speaker 1>using technology to disrupt that's disrupting something, and then there

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<v Speaker 1>are companies that uses technology to enable experiences to make

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<v Speaker 1>it a lot better. These are the two different things

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<v Speaker 1>right now, both is going to happen because the first

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<v Speaker 1>example are when the big companies are inefficient. These companies

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<v Speaker 1>are looking for opportunity to take them out on those

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<v Speaker 1>areas that's disrupting them. Then the other side are enablers.

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<v Speaker 1>They actually work with you, They actually enhances the overall

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<v Speaker 1>experience that actually brings you a lot of good things

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<v Speaker 1>about it. Both are good, both will happen, but I

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<v Speaker 1>think more good is going to happen on enabling the

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<v Speaker 1>fin techs along with you. That's my view on this.

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<v Speaker 1>All right, So let's talk about enabling for just a moment.

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<v Speaker 1>Because in the world a registered investment advisors and money

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<v Speaker 1>man chuers, uh, they are constantly trying to juggle, right,

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<v Speaker 1>You're juggling what the client wants, what your organization or

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<v Speaker 1>your research is telling you. But then also you're having

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<v Speaker 1>to do it at a lower and lower cost point.

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<v Speaker 1>Tell us about this. So the advisors in develop management

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<v Speaker 1>space is challenged by, as you said, two things. One

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<v Speaker 1>is providing the best client experience and the other you

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<v Speaker 1>said is about efficiency or how they operate. Yes, they

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<v Speaker 1>got to be very efficient. They got to look for

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<v Speaker 1>technology and innovation that's going to help them operate very

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<v Speaker 1>efficient because they want to spend time with their client

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<v Speaker 1>and actually do the right thing for their client. That's

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<v Speaker 1>what they want to focus now. Delivering the right experience

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<v Speaker 1>to their client is important and that's needed in the

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<v Speaker 1>demographics that's changing. Between how they use the technology so

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<v Speaker 1>where they should focus immediately is applied technology to become

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<v Speaker 1>very efficient and focused on the client. Now, as far

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<v Speaker 1>as focusing on the client goes, a lot of this

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<v Speaker 1>has to do with things that are custom made because

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<v Speaker 1>not every client fits into the same box. How have

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<v Speaker 1>you used the technology or open the technology rather at

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<v Speaker 1>Pershing in order to give the registered rep the tools

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<v Speaker 1>that are customizable. So what we have done is sometimes

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<v Speaker 1>the anyone who tries to take the technology on the

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<v Speaker 1>hand should be willing to spend consistently to keep up

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<v Speaker 1>the integration and experience together. That's a hard thing to do.

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<v Speaker 1>Certain advisers of the r A is willing to do it.

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<v Speaker 1>That's good they will and for them we have opened

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<v Speaker 1>up the Pershing services as an API, which is Application

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<v Speaker 1>programming interface where they can tap our services and put

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<v Speaker 1>it into an integration model. That's one thing for certain

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<v Speaker 1>r s who does not want to spend all that

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<v Speaker 1>money and they come to Persing for all the technology

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<v Speaker 1>things that we have done for them, we give and

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<v Speaker 1>end to end solution that they get on our platform

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<v Speaker 1>and they can use all the type of services. So

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<v Speaker 1>this might be everything from trade initiation to execution to settlement,

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<v Speaker 1>to then portfolio managed. That is correct. All these pieces

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<v Speaker 1>are all properly integrated into one platform to for them

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<v Speaker 1>to easily get on board. So that's the other model.

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<v Speaker 1>So now there are pros and counts to these models.

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<v Speaker 1>Depending on who you are and what your business model is,

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<v Speaker 1>you will end up picking which one do you want

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<v Speaker 1>to go with. Use the term digital advice in this context,

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<v Speaker 1>so a digital advice, I know the term robo advice,

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<v Speaker 1>digital advice. There are many things being used. There are

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<v Speaker 1>two connotations here. One is wow, then the technology is

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<v Speaker 1>going to take away the role of an advisor, and

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<v Speaker 1>the other one is the technology is going to help

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<v Speaker 1>advisor do things a lot better. So I'm on the

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<v Speaker 1>side of technology is going to help you. It's going

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<v Speaker 1>to enable you to do your thing a lot better.

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<v Speaker 1>That's on the side, and it cannot be replaced because

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<v Speaker 1>we talked about artificial intelligence for the last thirty years.

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<v Speaker 1>Did it replace any human being? No, But it's an

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<v Speaker 1>augmenting it's helping you. So the digital advice is about

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<v Speaker 1>how do you use this technology to make your job

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<v Speaker 1>a lot better so that you could be a great

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<v Speaker 1>advisor to your client. What would be one thing that

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<v Speaker 1>you wish sure that you foresee in the future that

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<v Speaker 1>advisors will have access to that will demonstrably improve their

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<v Speaker 1>performance or their customer service. It's about applying more and

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<v Speaker 1>more nor technology to help the experience a lot better.

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<v Speaker 1>That is important. Um, you know, whatever they do. Uh.

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<v Speaker 1>It started with give me sound by twenty four access

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<v Speaker 1>to my information. That's a couple of years ago that

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<v Speaker 1>it started. And now keep me connected all the time,

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<v Speaker 1>that's the second thing. Now it could be future. You know,

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<v Speaker 1>I want to be completely predictive. Give me a lot

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<v Speaker 1>of cognitive things. Those things are going to happen in

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<v Speaker 1>the future. So it's about keep up with the evolution

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<v Speaker 1>of the technology and selvia clients. Thanks very much for

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<v Speaker 1>joining me from Nagapon. He is the chief investment officer

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<v Speaker 1>for Pershing. They're based in Jersey City, New Jersey. Thanks

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<v Speaker 1>for joining me on taking stock. I'm pim Fox. This

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<v Speaker 1>is Bloomberg coming up. Bloomberg Law discusses whether there is

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