Banks need to partner with fin-techs to stay ahead of the game rather than developing their own solutions, says the New Zealand head of global bank HSBC.
Chris Russell, HSBC New Zealand chief executive, said history was littered with banks who had spent large sums of money on developing new technology, only to find it had gone in another direction while it was working on it.
"This is where fin-techs give us that great opportunity."
Globally Russell said HSBC was setting up innovation labs to work with financial technology firms and it was China and India where it saw the biggest sources of development.
India had gone from being very cash orientated straight to contactless technology, completely skipping the card stage.
In New Zealand it is also partnering with a local fin-tech, although Russell won't name who yet.
"We aren't concerned about disrupters we are embracing it."
He said banks also had an advantage because regulation was not going to disappear so banks provided a vessel for fin-techs to get their products to market through using a regulated bank.
Russell said payments was a key area of risk for the banks with the likes of Apple Pay coming onto the market.
"They provide genuine risks around settling which could be outside the normal banking processes.
"But it is not going to survive unless it is endorsed by the regulators so it swings back to the banks."
Russell said when it came to financial services consumers still needed confidence and trust.
He said there was a lot of talk about cryptocurrencies at the moment.
"We think they will be a genuine alternative."
But he predicted until they were supported by central banks it would not take off.
"Otherwise it is just one party buying off another. It is the trust element."
Russell said the move to more digital financial advice or robo-advice was an inevitable outcome of technology.
But he said that would still be over arched by a relationship model.
Banks would use robo-advice to make decisions quicker for customers.
He said HSBC, which primarily targets wealthier retail clients and corporates here saw New was very enthusiastic about its opportunities to expand in New Zealand.
Russell said while the bank been here for 30 years the realisation of the relevance of the New Zealand economy to the rest of the globe had really only resonated in the last few years for its global management.
"So they have been encouraging us to invest further to take advantage of that."
Russell said his biggest concern, and it was not New Zealand specific, was the political uncertainty around trade restrictions.
He said it was ironic that the leader of the free world, America, was making noises about restricting trade while China was encouraging it.
"New Zealand has to be careful in recognising it is very reliant on offshore markets for its continued prosperity," he said.