In general terms, we are seeing many developments across the financial sector currently:
- Banks are increasingly moving from a “if you want something done right, then do it yourself” approach, to buying products and services from third party partners.
- The number and types of digitized assets are exploding and facilitating the trading, sharing, lending, pricing, or collateralization of the assets that they represent.
- “Internetization” and AI (Artificial Intelligence) are enabling the disintermediation of traditional brokers through digital platforms that connect sellers with buyers directly.
- Cloud-based solutions are increasing in popularity and with that, the topic of cyber security becomes even more relevant.
In such a challenging environment, it is clear that only those with an agile mindset and a strategic vision for innovation will prevail. SIX has therefore launched a new business unit dedicated to the area of Innovation and Digital. We use future-scenarios modeling as an important tool to help us to focus our innovation activities
What will the future look like for the securities value chain?
The scenario which we consider to be the most likely sees primary markets taking the form of platforms, allowing issuers and investors to directly interact with each other, thus disintermediating those who had previously acted as middlemen. The world will experience an explosion in the number and diversity of digitized assets. Global tech companies will set up issuing venues to support activity in their ecosystems. New technologies such as automation, AI, advanced analytics, big data and cloud computing will be widely adopted throughout the securities value chain. Cyber risks have significantly increased as cyber-attacks have become increasingly sophisticated and quantum computing has become reality. Although permissionless distributed ledger technologies (DLTs) and crypto assets will not become dominant short term, crypto assets will retain some popularity with investors due to their diversification potential.
Future-ready products for the Swiss Financial Center
It goes without saying that SIX is working on products which will ensure that the Swiss financial center is ready to face these scenarios, from the most likely to the least likely.
For example, future SIX services like Swiss Cloud will provide a trustworthy cloud infrastructure which will reduce internal complexity and increase time to market for banking services. Swiss Cloud will also allow access to innovative AI and analytics services and create ecosystems such as Banking as a Service.
Our cyber security service is providing 24/7 cyber security event monitoring for Swiss based banks and insurances, validating incidents and alerting clients in case of a security incident. We are also in the midst of building up a platform where relevant cyber security information can be shared within participants from the Swiss financial center (banks and insurances), as we believe that this is key to build resilience against potential cyber security attacks.
SIX is also a main sponsor and operator of the F10, a FinTech accelerator and incubator which has become Switzerland’s leading collaboration space and accelerator program for FinTech. Additionally, SIX has recently also launched a corporate venture fund of CHF 50 million ready to invest into start-ups to the benefit of the Swiss Financial Market.
These are just a few examples and it is also just the beginning. We cannot rest on our laurels. We are firmly committed to continuing our success and sustainably support and strengthen the competitiveness of the Swiss financial center.
Daniel Dahinden joined SIX in 2016 as Head Corporate Development. Since April 2018 he is responsible for the newly formed business unit Innovation & Digital. The remit is clear: “We strive to position SIX as the innovation engine and thought leader of the Swiss financial center by developing innovative services for financial markets.”