I agree that view is prevalent in incumbents, but it is also flawed:

1. Players like WeChat and Tencent now have superior data sets to the banks due to the lack of silos, and they’ve used it with great success to compete in the mainland. Silo’d data can not be an excuse if you want to play in the digital engagement world
2. Data Laws/Regs — don’t forget every fintech and big tech is subject to exactly the same laws as incumbents. They might get a small amount of leeway when their are regulatory gaps (old laws that didn’t anticipate digital), but as a challenger bank I can tell you we have to satisfy the regulators just as incumbents do. The difference? We negotiate with regulators and seek waivers or exceptions more frequently based on a collaborative working style — banks do not. They let compliance and legal decide on the approach, most often simply that is “we can’t do that!”. We say “Why can’t we do this? It doesn’t make sense — let’s engage the regulator on this”
3. Risk avoidance — absolutely, but again if you are HSBC and you see that in markets like France a neobank (N26) or China (WeBank) actually have more customers than you and are still growing, you MUST realize that risk avoidance has now become your greatest risk itself!!

Sorry, I don’t give banks a pass on either of these points. It just shows they need to adapt, they need to change their culture and they need to reorganize significantly. Otherwise, the damage to their business will be permanent