Welcome to Breaking Banks, the number one global fintech radio show and podcast. I’m Brett King. And I’m Jason Henricks.

Every week since 2013, we explore the personalities, startups, innovators, and industry players driving disruption in financial services. From incumbents to unicorns and from cutting edge technology to the people using it to help create a more innovative, inclusive, and healthy financial future. I’m J.P. Nichols, and this is Breaking Banks.

Well, it’s the start of another year, 2025. It’s going to be an epic year. It’s starting off epic.

You know, I’m a big space fan. So we’ve got two major launches coming up this week with the new Glenn. By the time this airs, it’ll probably have happened in Starship Flight 7, I think.

But what we like to do for the start of the year is take a bit of a look at what’s happened in the past 12 months and look at our predictions previously a bit and talk about what’s likely to happen in the year ahead in terms of fintech and banking. And we’ve got a stellar lineup. Joining me in the hosting chair is my good pal, J.P. Nichols.

J.P., how are you doing, brother? Jason is on assignment today, but I’m here for the duration. Is he out of country assignment or is he just… I can either confirm or deny. We also have joining us, Mary from Cornerstone, Ron and Jim, regulars on the show.

So they don’t really need introductions, but Mary, what have you been up to lately? Well, I’ve been hanging with my parents, so that’s on a personal level. But I’m back in L.A. I work with Ron at Cornerstone as its editor at large and host a show called Money Isn’t Everything. Awesome.

Well, great. And I should say to all of you and to the listeners, happy new year, everybody. Yeah.

Happy new year. Yeah. And Jim, Jim Maroos from the Financial Brand and Digital Banking Report and a bunch of other things.

Jim, welcome back. Yeah, it’s great to be back. I just made my journey from Cleveland down to Florida for the season and just in the nick of time, as they say.

Yeah, absolutely. And actually, we should go back and check on the records. But I think you’ve been doing a podcast for 10 years now as a contributor.

And Ron, I think it’s the same for you, bro. Probably. I remember the first time I guest hosted, spent like hours.

You probably guest hosted 11 years ago. Yeah. Yeah.

You know, those stories are really kind of funny, because as I’m sure Brett remembers, my first one, I had everything well scripted out and lost the feed for my middle person. And so all of a sudden, I’m learning the whole idea of ad libbing as you go along. And it was seamless as I listened to it.

But I remember my mind just going crazy, going, you know, this whole hosting thing isn’t as easy as it looks. Yeah, we used to use Skype and it was a bit flaky, it didn’t work really well with the recording tools and stuff. Sometimes we’d have entire shows that would go missing.

Do you remember those days, JP? Sure. And we had to do them live. Oh, yeah.

We used to do a lot live. The first show, I know we’re very, very nostalgic, but let’s jump into the show. So what I thought we’d do, guys, let’s keep it simple.

Let’s do for the first half, let’s talk about the year that was. And then for the second half, we’ll get into the year to be. So first of all, let’s go around the table.

We’ll start with you, Mary, if you don’t mind. Pressure cooker. No, no.

Well, if you don’t, if you want, I can start with JP. No, break it. I’m your friend.

But I know you’re more than capable. I don’t have a lot of takes. It’s true.

So let me start with you, Mary. What were the big moments for you last year in the fintech slash banking space? Well, I think the biggest moment is Synapse, right? So it’s hard to like think of anything else without thinking about that first. And so like that is the big moment for me.

I guess we’ll call it fintechs reckoning in a way or exactly so. And so that’s been most on my mind from the year as a very negative and from positive or maybe positive. I’m just kind of curious.

It seems to me like mental health things are starting to blur in with some of these fintech apps. And I’m curious about execution of these things, but I’m really thinking it’s a positive trend to at least acknowledge that, hey, yes, someone’s emotions are involved with financial decisions. It seems like that’s been something that’s been locked out of consideration for a bit.

That’s a cool perspective. I like that. We are definitely hearing a lot more talk about agentic AI.

We’re going to get into that in the second half, I’m sure. But Ron, what about your take? What were the big, big things for you last year? I’m not sure I’d call them necessarily big things, but I think last year was characterized as two separate years in one and not evenly split. It was the first 10 months where it was kind of dragging on the fintech side.

The investment levels seemed to kind of drag. The bankers were just totally dragged down by both fraud and regulatory. And then after the first week in November, it was like the clouds parted, the sun shone down, and it was like, boy, this is going to be great.

And I’ve actually got my annual what’s going on in banking report coming out in about two weeks. And this year’s subtitle is a happier days are here again. I’m not quite sure it’s happy days, but there’s clearly a lot more optimism going into 2025 than was going into 2024.

Do you think it’s all justified? No. And that’s why the subtitle is happier and not happy days. Because it’s interesting.

I’ve been asking in the report for 10 years now, how optimistic are you for the coming year? And I mean, literally, this is the highest levels of optimism since going into 2017. And you can guess why that was so optimistic back then. But there is still the feelings among a lot of bankers in particular that we’re really not out of the water.

Deposit gathering is still an issue. Lending world is kind of murky. And the whole fraud thing is a big looming.

And I think on the fintech side, it’s, you know, you’ve got a couple of players who are growing big and a lot that aren’t. And so there’s some mixed emotions on that side as well. Yeah, let me jump in there and add some context.

You know, we did have NewBank hit $100 million and Revolut hit $50 million last year. Those are big numbers. WeBank hit $450 million in China.

And in terms of profitability, NewBank and some of these players are showing very strong profitability, which is, yeah, at scale, you’ve got some big IPOs coming up, Kleiner IPO. We’ve got rumors of the Chime IPO now. And we had Bitcoin hit $100K.

You know, like whoever thought that that would actually happen? The crypto bros have been talking about that for a while, but it’s a pretty big milestone. So and then Elon is like, you know, he’s a crypto bro. He built the first fintech.

That’s got to have some impact on where we go from here. So I think, you know, I don’t know whether that’s part of the connected optimism that happened in November. But anyway, Jim, sorry, we left you out of the converse so far.

No, no, I think, you know, to Ron’s point, the economy, if we think back a year ago, everybody was still scared pretty bad about the economy, where it was going to head. There was a lot less directional momentum. You know, we thought, well, maybe it is, maybe it’s not.

Financial institutions had pared back a lot of their investment, everything like that. And I think the market having a really a phenomenal year again. And most indices saying that certainly in the United States is one of the strongest economies out there in the developed countries.

It really gave a little breathing room. It took some of the fear away. On top of that, you know, I’m working quite a bit as Ron and Mary and JP are as well with smaller financial institutions.

The third party providers of solutions has made it so organizations of virtually any size compete, can compete with the biggest. That said, there’s no denying the fact that instead of a top 10 or top five banking institutions, there’s a top one and the rest. I mean, the reality is Chase shines above virtually all others in the ability to churn, to move, to implement things.

But it is really exciting to see some of these smaller financial institutions just doing some amazing things despite not having the financial wherewithal. But they certainly have partnered with some very strong organizations to be able to develop things like a better new account experience, a better digital experience, even replacing their core. I mean, it’s amazing what the smaller organizations are now doing.

And I think I probably said this a year ago, the issue is really what are the midsize organizations going to do? What are those from 50 to 100 billion going to do because they aren’t keeping up. They’re the ones that are kind of like, they get stuck between the, I don’t have enough money and I don’t have leadership that’s visual, you know, can visualize what’s going to happen. Yeah.

Culture is a big part of it. JP, what about the LA Labs perspective in terms of, you know, how’s that sort of conversation matured over the last 12 years, more, you know, more of the sort of community style banks that Jim’s referencing? Yeah. Well, first of all, I think you have to start where Mary started and think about what’s the broad economic backdrop.

And in 2023, we saw the return of bank failures, right? With Silicon Valley Bank and some others. And as she called it in 2024, the fintech reckoning, right? So you had Synapse and some of the other third party providers, players who were really, you know, starting to shift that. You add to that the economy that Jim just talked about.

I mean, the great news is, yep, super strong economy. Bad news is, where do we go from here? I don’t know how you get a whole lot better from here. And then the political environment that Ron’s been hinting at, this feeling that, you know, we’re used to a little bit of a spectrum, right? Things are either a little bit tighter and more regulatory based with Democrats.

Things be a little bit more loose and business friendly and bank friendly under Republicans. I’m not sure this incoming administration is all that predictable, right? I think there will be some loosening and some tightening and there will be some very unpredictable things. But obviously then as you get into the technology trends, AI, certainly 2024 was the year that AI hit the mainstream.

You’ve been talking about it for a long time, Brett, but it’s actually in daily use now. The number of, you know, people who are not very tech savvy at all are saying the words, well, I asked chat GPT and, right. And that’s, I know chat GPT is in the end all be all of AI, but it’s a tip of the spear that points to it really beginning to permeate.

And then lastly, I think we saw the underpinnings of a movement towards true open banking for the first time. So we’ve got section 1033 from the CFPB rule. Maybe that’ll hold, maybe the CFPB will even still be here or not.

I don’t know, but I don’t think the genie is going to be put back out of the bottle. The reality is that we’re heading towards something not completely dissimilar from PSD2 in Europe, which really set some standards for technology and the access of those technologies. And really most importantly, set the stage that the consumers own their data, not the banks.

And so I think that’s going to really, really begin to play out this year and in the years beyond from here. I don’t know how you run AI capable banking without open banking, frankly. I don’t think you can, right? You know, if you’re going to have AI agents talking to each other, it’s got to be on open banking rails.

At least that’s my perspective. Anyone got any counters to that? You know, it’s interesting, JP, you mentioned AI and yes, every bank is toying with it in conversation at least. I see that what is actually happening, and Ron can speak to this because I’ve seen a couple of his presentations recently, and the talk is certainly much stronger than the walk.

For sure. The actual implementation is done by a few institutions. When you talk about some of the dynamics of retail banking, where they talk about the personalization factor, it is at, I would say at zero or maybe 1% with regard to how chat GPT or AI, generative AI is being used, it’s still being focused most importantly towards fraud and risk, which is where it all started way back.

And efficiency gains. I think we’re going to start to see organizations starting to look at the implementation of AI agents, but only those that are not afraid of some risk factors. Because as we all know, we’re almost all bankers by trade in some way, shape or form.

Banks hate risk. And when you’re using it for personalization, you’re making assumptions on people’s movement towards something. And banks just hate to make that step saying, oh, we think you’re buying a car, let alone, we think, you know, we know what your next step should be.

You know, yet our GPS systems in our car can tell you everything about the future based on crowdsourcing. It’s just, it’s against the dynamics. I think we’re going to see some really cool AI agent implementation, but it won’t be by traditional banks.

I don’t think. Well, yeah, I mean, this is really interesting because, you know, the data to train for that type of, you know, granular decision making you’re talking about, Jim, requires us training LLMs on financial data. And as far as I’m aware, we aren’t, no one in the industry is doing that.

There’s Casisto up in Canada and Huawei’s got an effort to do that. And there’s some efforts in Dubai, but, you know, I haven’t seen sort of industry level attempts at building that sort of generative finance data set yet. So, we’ll see.

And this is a slight tangent, but on the theme, and it’s something that I’ve just been zooming in on lately, and it’s, you know, the search effect of AI, Chachi, BT, et cetera. But something wild happened here not too long ago with Forbes Marketplace, which is like a separate thing from Forbes, but they got very penalized for the way that they’re like serving up their articles of best of list. It’s not just like best of, you know, savings accounts.

It’s also like, I don’t know, there’s a million ways that the referral links work, but Google said no. And like now they’re dinged, so they’re like not coming up on search as much. So I feel like broader picture here, and that’s specific to Forbes Marketplace, because there’s a lot going on with that particular brand, but the way that banks and credit unions are popping up on search for like, hey, I have a really good, you know, savings account, it’s changing.

And I think, I mean, that was within a couple of weeks. So I feel like that is also something for the industry to pay attention to, because the way that they’re appearing to consumers is changing and changing very quickly. So what you’re saying is that the reason that nobody reads my blog is not because the blog posts suck, but because Forbes is SEO.

Ron, importantly, Forbes Marketplace thing is different from what you’re doing, because you would not want to be involved with another brand right now, I promise you. What about, I know, you know, this has been quite US-centric, the conversation, but what about offshore? What, in terms of fintech moments or banking that sort of happened outside of the States, what were the big things for you guys? Silence, crickets. Hang on, hang on, I’ve got a sound effect for that, I don’t know if you guys can hear that.

You know, you brought some of this up. I mean, you look at Nubank, you look at, you know, in the developing countries, what’s going on in India, what’s going on in China, which is not a developing country, but it’s certainly a different animal. What’s going on in South America and Africa continues to, you know, if you pay attention to it, continues to be pretty advanced.

It’s fun to watch. Well, a lot of those systems are greenfield, so, you know, you’re building new capabilities. That’s what’s sort of happening.

That’s certainly the case for Africa with mobile commerce. They didn’t really have an e-commerce industry per se, and it’s all gone to mobile. And then suddenly, because now people have internet access via the phone, it’s exploded there.

So it’s pretty cool. I think in other countries, some of them, like Monzo had recently launched a little feature that would like help someone communicate to the bank in sign language. And I think some others have been like letting people like block, like certain people from sending them money and if they’re like, you know, economically abusing them in some way.

So I think the US is not the leader in this way. And I think it’s really interesting to look at other countries for like how they’re like dealing with these big issues in small ways. Yeah.

Klarna also has been sort of walking the talk on the AI front, talking about, you know, they’ve moved away from their SaaS platforms to AI based tech now, and they’ve reduced their, you know, as part of their pitch for their IPO is they’re reducing team size with AI implementation. So that’s pretty aggressive use of AI structurally within a fintech. But I mean, I think that’s one of the issues that the industry is going to face over the next couple of years is being able to deploy AI within your bank requires both a cultural and technological philosophy that we really don’t see in most banks.

So, you know, you talked about the fintech winter, Mary, but could this be with, you know, fintech and AI sort of really starts to set it apart experientially from, you know, traditional banking experiences, you think? Could be. Yeah, I think for me, the dividing line is more advanced developed economies with more mature banking infrastructure. You just hinted at it, Brett, that, you know, when that is not in place, things are able to move much faster.

There aren’t as many entrenched competitors. So I think if you add that to what Jim just said about, you know, those that will and will not do that, I think for the traditional players, we highlighted in our executive briefing in the third quarter of last year, there were really four major themes that we saw in the United States. But I think it would be fair to say this carries out to all the well-developed markets.

And the number one is just VUCA, volatility, uncertainty, complexity and ambiguity. Right. It just reigns.

And, you know, the market doesn’t like that. It likes more certainty and predictability, but we see that continuing. The second thing is, you know, the attrition and disruption risks.

So when you’ve got an incumbent customer base, which, again, not as active in so many of the newer developing markets, they really have more options than ever before. They are better educated. They understand what’s out there more than ever.

And for particularly in the U.S. and Western Europe, an aging customer base. Right. So those that have have been using the traditional services for a long time are not getting any younger, just like a few of us here.

And then the last two are a little bit more internally, but it’s the margin and liquidity pressures. You mentioned NewBank and the low cost structure of the digital players. It’s really hard to maintain that deposit base with the cost structure that you have.

And so that leads to the last thing, which is the need for efficiencies. And so the big incumbents, you know, the job cuts continue. The branch closings continue.

Asterisk. I know there have been some that have been opening branches in very targeted, select markets, but for the most part, I’m still skeptical on that. Yeah, I’m shocked to hear you say that.

You know, that you know what you just said, though, JP, is is where the banks, the traditional thinking of banking continues to undermine traditional banking, whereby when you look at AI and AI, if you look behind the curtain, most of the efforts are being used for fraud and risk. Understandable. And then efficiency, you’re not at all front facing to the consumer.

They they talk it because that’s really sexy to talk about it. But the reality is, is how can they squeeze the last dime out of out of our current structure, doing bank in the same way, but faster and cheaper as opposed to doing bank in a new way, which, again, that’s that’s the benefit of a small organization. You can change your whole banking model in a year in today’s marketplace and reconstruct what you’re going to market with.

And it works really well. But, you know, the frustration of what’s possible versus what’s going on is just it’s unnerving at times because you just go you can talk with this is why we’re all employed. We can say the same thing for the last 10 years.

We’ll say for the next 10 years and we’ll still have people that aren’t doing it. And it and it is frustrating because there is so much potential out there. Jim, I think there’s nothing there I would argue with you on.

But I think there’s another angle to this that we’re overlooking. And I like to tell the banks that I get to talk to in the credit unions that you’ve really got to look well, first of all, they got to look at AI more specifically in terms of conversational AI, machine learning, generative AI, robotic process, you know, that that dichotomy or not dichotomy, but that categorization. But also importantly, look at it from the perspective of enterprise use versus personal use, because, you know, there are tools that help you manage your schedule, that create content, that, you know, look at so many different things that we do.

I mean, just the OK, I was going to say remember, but there’s only a few of us actually on this call who will remember back when PCs came out and we started using not Excel, but Lotus one, two, three. And there were all these add-ins. VisiCalc, wrong.

VisiCalc, yeah. VisiCalc and Havoc Graphics. Remember? That went pretty quickly, actually, before Lotus stepped in.

And but, you know, the point was that there were all these plug-ins and that’s what a lot of these, you know, personal AI tools do. And I find that you ask the typical bank or credit union executive team, you know, what’s your organization doing with AI? And they usually say, well, we’ve got it in the call center and we’re doing some stuff around fraud. And I go, what are your people doing with it on an individual basis? And they have no clue.

But there’s a lot of use of that stuff. And I think this is where a lot of the interesting things are happening at the personal productivity level, not necessarily the enterprise. Even on an education level, Ron, I mean, the reality is the only way that I feel I can keep up with what’s going on in the marketplace is to talk to ChatGPT or Claude or one of the other ones daily and saying, give me a recap on what happened in the financial service area and CES yesterday.

And it can come up with an answer. It may not be perfect, but it keeps you up to date on what’s going on. And it is amazing how many people still either they’ve either bought in or they haven’t bought in.

And very few are using it to I think the only way you can keep up at all in any area right now. This really leads into the conversation of what’s going to happen this year. So why don’t we take a quick break, guys, because we’re running up against the clock here.

We’ll take a quick break and we come back and let’s get into how AI is likely to roll out in the market in 2025, what could be the gains and who are going to be the players in the mix and do that. All right. How’s that sound? Sounds good.

You’re listening to Breaking Banks and we’ll be right back after this break. Become a leader in the emerging fintech space through NYU Stern’s Master of Science in fintech program. This is a one year part time program divided into one online and six on site modules that take place in New York and in rotating global locations.

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To learn more about the program, submit your resume for a candidacy review at stern.nyu.edu slash MSFT dash Breaking Banks. All right, well, we started the show talking about what happened in 2024 that’s leading up to this year, 2025. Let’s turn the lens forward and talk about what do we think is going to happen.

And, Ron, what you were describing is a very typical pattern, maybe the most typical pattern of how technologies are dispersed in the workplace. It’s not that the CEO or the CTO says, hey, I found this cool thing at CES and we’re going to implement it now. It’s brought up from the bottom up, whether that you were talking about spreadsheets or cell phones.

Now we’re talking about AI and other tools. So I think that’s the predominant method we’re going to see this. So given that, what are the things that we think are going to really catch fire this year? You know, I think it’s already started, but I think we’re going to see a huge amount of AI in the call center.

There’s a lot of stuff going on around sentiment analysis, retrieval, augmented generative approaches. There’s just a lot of stuff going on. I mean, obviously, it started a while back and I don’t just mean chat stuff, but a lot of large language model development that’s very customer centric or call center centric.

The other area, I mean, clearly it’s more niche, but for those organizations that are adopting it from a lending perspective and a credit management perspective, credit score, portfolio management, things like that. A lot of organizations kind of moving in that direction, although it’s far from the majority because a lot don’t see the application of it there. Beyond that, I think, as I was alluding to before the break, I think a lot more of it is sort of personal productivity oriented kind of stuff around content development, marketing areas or the marketing departments.

I think there’s a lot of talk around, of course, a lot of people are going to lose their jobs. I don’t buy into it. But if there was one place where I’d be a little concerned, it’s marketing agencies.

I’ve heard stories and Jim might remember this from the financial brand forum of one CMO talking about her use of chat GPT to develop marketing assets and material and then putting it up against the agencies and the management team voting for the chat GPT generated marketing stuff. So I think those are just some of the areas that are really going to move from a functional perspective really fast in twenty twenty five. Very interesting.

You bring up the whole creation and you look at chat GPT introduced two months ago with their or actually just probably a month ago with the video creation from text. So if you play with it, you just you’re in awe. I mean, it’s like watching the spaceships land on their into their claws.

You just go didn’t expect to see that. And it happens out of nowhere. I think we see a lot of that.

And I think as it becomes more consumer engaged, we’re going to see consumers that are demanding more net to your point. That’s going to put marketing direction can put IT departments on warning as to what is expected from financial institutions, because if you look at what we’re getting from restaurants, from takeout services, from Uber right now compared to what we got two years ago, we’re elevating our our understanding of what’s possible to a degree that it’s going to be hard to keep up if you haven’t tried to keep up. And that gets back to your comment before the break around individual education and individual involvement.

The chairman of the video yesterday said IT departments are going to become the new human resource department for finance for organizations. And when you think about it, they’re going to be managing how AI is to be deployed across the organization. And that’s kind of exciting.

But when you look at legacy organizations, also quite scary. Absolutely. I’m going to I’m going to argue with whoever it was that said that IT is the new place for it, because I think that it’s the exact opposite, that technology, thanks to the advancements in low code, no code, the advancements in AI.

I think the big impact, the biggest impact is actually going to be the shift into the interface. We have spent the past 40 years learning, starting from how to input codes into MS-DOS to a graphical user interface where we understand the menu structure. And now that’s going to get blown away where all we have to do is talk to the damn thing and tell it what to do.

As a result, the dependence on IT diminishes, not increases. And I have said that I think one of the impacts of of AI in general is that functional managers, AI will report to the functional leaders. And in effect, it’s a weird concept to think that your chatbot or your model reports to you.

But you have to think of it as a direct report because you have to think of it in terms of what’s the professional development? Where do we build these things? Now, tech companies call those things the roadmap, but users don’t understand that. They just think, oh, I need new stuff. Where do we go? How did you do last year? What do we do with you next year? And I think it actually further decentralizes IT to the departments, not re-centralizes.

I’ll jump in here. I mean, I think the big thing we’re going to hear a lot about in AI circles, two things we’re going to hear this year, a lot of debate around AGI because it’s already starting 04, which is the 04 for Chachabit-4, has already surpassed all of the logic and cognition tests we’ve thrown at it. And people are saying that it is as close as we’ll be able to define as artificial general intelligence from a consciousness perspective.

And the second piece is agentic AI, which is what you’re leading into, Jim and Ron, in part is that the implementation of AIs that you can personally train that can go off and do stuff for you. We’re going to hear a lot more about that this year. That’s cool.

Yeah, I know I’m trying to get better at the prompts. I didn’t realize what an art that is of the way that you prompt the LLMs and even compliment them. I’ve heard like complimenting will get you better results.

So I think I think that’s just interesting. I’m in trouble. Yeah, Ron, you’re in a lot of trouble.

What, if anything, is going to happen with Section 1033 rules with CFPB and the early moves to open banking? Gosh, I’m really, you know, it feels like a super unknown because of Trump. And I don’t, yeah, I don’t have a stance there. I don’t think JP, I have a hopeful wish, but I don’t, I don’t have a stance that, you know, we’re rocking and rolling here on open banking.

Yeah, I don’t think it’s going to move that fast. First of all, I don’t think it’s high enough priority for the Trump administration to really deal with this at the point at the point the whole CFPB thing is a different issue. I actually don’t think that’s going away either, although my bet is we see a new director almost for sure.

But I don’t think it goes away. I don’t know if you guys saw, I wrote an article a week ago or so saying what Trump ought to do was remake the Bureau into the consumer fraud protection, not financial protection, because this is where the real problem is. But here’s the thing I’ll share with you, too, from the upcoming what’s going on in banking.

I asked bankers about their thoughts on 1033. More than half of them think it’s bad for banks. And so, you know, it’s a change.

It’s changed, but it’s it’s a it’s a it’s about it’s about an investment. They have to make an infrastructure that doesn’t necessarily pay back, or at least many of them don’t think it will. But, you know, I always reminds me of the movie A Few Good Men, you know, where Jack Nicholson says, you want the truth, you can’t handle the truth.

I think of that because it’s like you want your data, you can’t handle your data. I don’t think consumers recognize how much work it’s going to take. So I manage these things.

I think it’s going to open up to fraud. You know, it’s going to take a good couple of years before this 1033, assuming it’s left alone before it really impacts most of the market. So we’re not going to see any impact from this for a good couple of years.

Yeah, I tend to agree with that. And in 2018, Visa actually brought me down to Australia to work with some Australian and New Zealand banks. And one of the things they wanted me to, me naturally an American, to talk about was, hey, how should we think about how Europe handled PSD2? And what I told them was, look, I’m not an expert on that.

But what I can tell you is that’s not just a five year story, right? The most recent five years were about the rules getting finalized in each country, finalizing their, you know, country wrapper around it. It’s really a 25 year story. And it’s about the digitization of transactional data, which allowed, you know, the first thing we could think to do with it is, hey, sign up for e-statements.

It’ll save us money. And we don’t need to print out paper statements anymore. But the quickens and the yodelies and the mint.coms of the world said, well, wait a minute, this is a new capability.

And with this new capability, we’re finding new jobs for customers to do, right? Customers are downloading this into their Lotus 1, 2, 3 and VisiCalc that we were talking about. And they started to create their own budgets and pie charts and bar charts and so on. And that really was the, you know, beginning seeds of personal financial management, which went on and matured a lot.

So you’re right. It’s not going to happen this year. But I do wonder if the genie isn’t still out of the bottle.

And, you know, we’re going to tend to move, you know, data wants to be free, as they say. But certainly the incumbents are going to push against that because. But I’ll give you a bit of perspective on this, JP.

I mean, I think you’re right. But I think, you know, think about all of the banking data that’s already been ingested by, you know, like these engines and so forth over time. So we’ve already had that to some extent.

You know, AI is already consuming banking type conversations and certainly financial conversations. So there’s impact there. But just even what Jim was talking, I think it was Jim was talking about GDPR impact earlier.

And if you think about how regulation is likely to change in the future, I think a lot more of that transference of regulation from one jurisdiction to another is going to happen because of the speed of change. Right. You know, the reason we didn’t start from scratch with 1033, you know, like taking the lessons from GDPR is because it worked pretty well and we’re able to iron out some of the bugs.

But over time, I think that means because of technologization and AI, I think it’s going to see, you know, see regulation form along trading block lines with smart contracts and CBDCs and things like this. I think a lot of what we think of as banking will become from a regulatory perspective globalized. I don’t know what you guys think about that, but that’s the futurist hat.

Right. I think the positive aspect of it is that it will spur and facilitate the standards development. And that, I think, is the big impact.

But the impact of that takes a while. Yeah. Yeah.

And it’s already it’s already taken such a while because I remember when I was a born in American banker, this was the storyline I always was covering. And it was like, you know, which bank is blocking which, you know, data sharing thing. And it’s just wild that it’s still where we’re at, which is not that not that what’s interesting here, though, Mary, is that the consumer is doing it on their own.

I mean, what the banks, the banks may not do it. We may not allow our banks to necessarily do it. But, you know, we all have five, six, eight, 10 different financial relationships and we combine them on our own.

It’s like this whole open bank thing is happening. It’s just happening without the banks. We’re doing it ourselves.

So we’re opening a bank for our automatic deposit. We’re opening a bank for our lending. We’re opening a bank for our business account, for our PayPal, whatever it may be.

And, you know, as a trust increases with certain financial institutions, their ability to bring that all together is going to be the again, I think it’s going to be the agent that’s going to do this, either that we have that we ordered to do things or that the financial institution does on our own. Right now, the way the path’s going, I’m more likely to to take on an agent that’s going to bring all my data together and bring me recommendations when the bank had at their fingertips to do for me. I just it’s it’s it’s interesting because, Mary, you mentioned about the whole idea of prompting.

That’s the skill that you’re going to need going forward, no matter what level you are, no matter what job you’re doing, if you know how to ask the questions, you’re going to get the right answers. Well, it’s going to be made easier and easier as a direct, you know, there’s going to be somebody out there is going to provide a direct solution that’s going to allow me to prompt it with with normal words to get what I want that I’m currently doing all on my own paperwork. I mean, the amount of my time my wife spends on taxes is insane or taking another industry.

And when you guys reach 65, you’ll realize that the whole dealing with Medicare and Medicaid is the most convoluted thing in the world for people that by age alone says they aren’t going to be the most capable people to do this. And the reality is there’s going to be an A.I. tool out there that says, tell us everything you want. We’re going to provide care is going to get completely revolutionized by A.I. I don’t think I don’t think people understand.

And this is a it’s going to be enough a tangent again, that this this could be a major challenge to the structure of the health care industry in the United States as well, because, you know, as soon as you start getting A.I. agents managing your health, then it has to break the bounds of the current sort of insurance and, you know, FDA system, at least. Well, we’re currently we currently have more tools. My watch, my ring that provide instant feedback as to what my body’s doing and you transfer that to the doctor, to the physician, to the health care provider.

They now have every tool available to tell you on an instant basis. Oh, Jim, you you should probably be heading to the hospital right now because we have all the data we’re seeing. It looks like X. And we’re going to listen to that because, you know, in much the same way when a financial institution provides that kind of capability or an outside company provides it, we’ll be ready to work with it.

Have you guys watched the Brian Johnson longevity show on Netflix yet? No, that’s another thing you’re going to start hearing a lot about over the next couple of years, longevity treatments. And this is why, you know, it’s really interesting. But the destination of what Jim’s talking about for health care, managed health care with an A.I. agent and the future of money management with an A.I. agent are actually very closely aligned.

So if you when you look at managing your money in the future, you’re going to trust your A.I. to do it better than the banker, because it’s going to know about your behavior and your goals and your objectives and all of those things. And we had to manage that altogether in a way, you know, you could never get even from the best private banker in the world. Right.

That’s my view. You bring attention to that and that makes it so that the health care is a financial decision and vice versa. Yeah, it’s really curious.

I’m also curious, which is like how consumers who are more of the gig workers are like handling health care. And I saw I think it’s in Salon or something like that. But it was one gentleman decided to be a crossing guard so he could just get, you know, insurance from that way.

And I think it’s just interesting. It’s not directly like this matters for banks, but it’s what it does. It’s like a financial product.

And you’re also saying I think the startup is called Hello Divorce. And it’s just like bringing down the price. So all of this all it just has implications of like financial product types of things.

And it’s interesting to watch. And one thing I did want to bring up to you all, because I’m curious your takes on this, but perhaps it’s to Ron’s point of happier days. But I still hear here and there of like this entrepreneur who wants to start a new bank and like a fintech bank.

And that is because he or she views it like there’s still a hole. There’s not that there’s not better banking yet. And I’m kind of curious if you think that idea.

Sounds fair, it’s I tell you what, it is wide open for A.I. banking. The next stage of fintech startup generation is going to be this highly A.I. startups from scratch that are going to even compete with the the 10 year old fintechs, I think. Mary, do you mean an actual bank with a charter? And yeah, yeah, I think in the U.S. that hurdle is still pretty high.

And the more non-traditional you get, the higher those hurdles become. But certainly they’ll continue to be neobanking offerings. One of the other things we’re looking at a lot with our members is what’s happening in small business and medium sized commercial business, right? The bread and butter of so many banks and the rise of RAMP and Brex and Mercury and others that are providing services that, you know, customers want and need and aren’t getting from their bank or aren’t being offered proactively, at least.

So in the broad sense, I agree with Brett. It is wide open in a more practical sense. If you really want a capitalized, chartered, regulated bank, that’s not so easy.

And the less traditional you are, the harder it is. Who brings together the best of? You know, you talk about the small business and medium sized business organizations. You know, we have all these solutions, but we’ve got to find a way to consolidate them.

I, you know, I’m still a believer that somewhere along the line, Amazon is going to become the consolidator of my personal banking relationship. They’ll offer a Chase checking account with a PayPal payment mechanism. They’ll bring all these things together.

And with all the data they have, they’ll be able to give me better answers as to how to use each of them most effectively, as opposed to anything we see today. And, you know, you see all these guys contributing a million dollars to an inauguration program. You know, there’s some reason for that besides wanting to see more fireworks.

So, you know, you tend to think that there’s new ways of constructing the consumer experience that no one’s delivering right now. Yeah. All right.

So who do you think will be the first big fintech IPO this year? Not Chime. Not Chime. They’re talking 2026, I think.

Are they? I think it’s going to be Klana. I guess it’s going to have to be Klana. I would say that.

Yeah. And very, very interesting. And what we should also take bets on while we’re all here before we finish off is when do you think the first AI unicorn in fintech will emerge? This year, because they’ll all claim to be AI.

Okay. That’s how they’re going to get the valuation. Well, what? That’s the snarketing take.

You know, I’ve never seen a time when I have less confidence what AI can do. I mean, once Sora came out with the text to video, I’m going, I couldn’t see that happening at the time period it came. And you just go, where will we be 12 months from now? And again, go back to the rocket ship things.

I never in my life thought I’d see a booster rocket reland itself, let alone within claws. Caught in the chopsticks, too. Oh, come on.

That was the most epic thing I’ve seen. We can’t get people off the space station, but that’s another show. We’ll leave that for the futurists to talk about.

But yeah, I think for Breaking Banks, we’ll leave it here today. Mary Wisniewski, Ron Shevlin, Jim Maroos. Thanks for joining Brett and me this week on the 2025 Outlook show.

So if you like the show, please subscribe and please recommend to others. It really helps us grow the show. And you can see and hear this and all of the shows at provoke.fm on our YouTube channel.

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That’s it for another week of the world’s number one fintech podcast and radio show, Breaking Banks. This episode was produced by a U.S.-based production team, including producer Elizabeth Severance, audio engineer Kevin Hirsham, with social media support from Sylvie Johnson. If you like this episode, don’t forget to tweet it out or post it on your favorite social media.

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