Open banking provides competitive edge

Bryan Wilken

Bryan Wilken, chief information operating officer at Bank Midwest, based in Spirit Lake, Iowa, can be found online these days extolling the virtues of open banking. Wilken shares his thoughts on how the pandemic accelerated banks’ demand for cutting edge tech. 


Community banks have a history of being technologically curious but cautious. A lot has changed in the past year. Thoughts?

Bryan Wilken: This is absolutely changing. The fact of the matter is that the pandemic has forced community banks to digitalize in ways many never had to before. We’re also facing a lot of competition, both from each other and from the big banks, and that means we have to innovate.  If we can assist our in-person value proposition through technology we should be able to stay competitive. 

Besides the pressures facing community banks, there are also fintech companies right now that utilize new approaches like APIs and open banking to allow community banks to find the right partners and solutions for our specific needs. This makes embracing new technology much easier than it has historically been. I feel that the pendulum has swung back to community banks being able to be more agile than the large banks when it comes to offering more personalization.

What solutions may have been out of reach to small banks a while ago but are available now?

B.W.: I’ve been in the community banking space for over 20 years, and I remember when community banks would have to go to their core provider and ask for a list of other vendors that they could work with. This made our approach to technology very reactive, rather than proactive, because we were limited by what systems could talk to each other. With cores being traditionally closed, you would start with a core and build out with other solutions from there.

In recent years, there has been an evolution in technology to open APIs, allowing community banks to choose the solutions to differentiate themselves, both from competitors nationally and down the street. For Bank Midwest, having access to an open banking platform has allowed us to pick the best solutions for our bank and partner with fintech companies we wouldn’t have had access to before. The level of collaboration open banking and open ecosystems provide has significantly accelerated our digitalization timeline. 

Some of the solutions more available to smaller banks revolve around payments technologies, AI and machine learning, process automation and niche solutions for niche customer needs.  Fintechs are good at solving a problem and focusing on that one area. Those problems or needs for customers and employees are influencing our priorities on digital transformation.

What are some tools that every bank should consider? 

B.W.: In my opinion, the cloud is the future of technology, and it absolutely needs to be on every bank’s radar. The pandemic caused so many financial institutions and organizations to have to scramble. For Bank Midwest, migrating our core to the cloud lends greater security and the ability to really leverage AI and draw insights from the data we have that could never be achieved on-premise. It should also allow us to launch new services much faster than we could before, which has become increasingly important with a new, younger generation of customers. For community banks in particular, which are facing so many pressures right now, cloud technology is an absolute necessity to stay competitive.

I also advise solutions from vendors that solve today’s needs and can scale with your bank. I hope the future of financial technology does not involve the continuous cycle of using a system and replacing it with an entirely new one a few years later. Hopefully our tech stacks can have more standards and open models in place so that we don’t have to replace the whole system.

How does Bank Midwest balance artificial intelligence with human intelligence?

B.W.: Banks digitally transforming through technology like cloud services will usher in more personalized service and better-met customer expectations. We’ve seen with companies like Amazon that services can be made outstanding when they’re assisted by technology, and I think that model is reverberating across all industries. I’m hopeful that by embracing innovation and cloud technology, community banks will be able to offer customers more personalized assistance in their financial journey than ever before, and that is really what community banking is about at its heart.