EXCLUSIVE: Investec mulls digital assets wallet
Investec is mulling the introduction of a wallet to hold its clients’ digital assets.
Chris Becker, blockchain technologies lead at Investec, says it is envisaged the wallet would hold the wealth management group’s clients’ blockchain-based assets, and that it is agnostic to the technology, as well as the asset.
This, in part, “depends on where the market goes”, Becker told ITWeb on the sidelines of the Blockchain Africa Conference 2020 in Sandton last week.
“We’re not the decision-maker per se; we need to offer value to our clients and whatever asset they want to own, we can help them secure it.”
Becker said Investec’s clients are interested in owning digital assets for a number of reasons, noting they are typically of a high-net worth, and have disposable income which allows them to speculate in this asset class.
“They have more risk appetite. There’s definitely interest, and potentially more interest among our clients in this asset than some of the other banks, when you look at a percentage of clients. And that’s forced us to focus our minds on this.”
Investec is also mulling exactly which clients to offer the service to; such as high-net worth private banking clients, or its wealth and investments clients.
The wallet could also be offered to what Becker refers to as “internal clients”, such as its corporate institutional bank.
It’s envisaged the service will be available through Investec’s app, or online banking. Internal clients, meanwhile, would access it through a different interface.
Becker said the fee structure is also under discussion.
Little blockchain adoption among banks
“At the moment, we’re testing this with staff clients just to see how it works, and then we’re going to figure out the next steps before the end of the year,” Becker said.
Five years ago, there was a keen interest in blockchain among local financial services institutions, but this, however, seems to have dissipated. Part of the problem is that banks are risk-averse as well as complex organisations.
With Investec’s proposed wallet, Becker and his blockchain team had to work across a number of departments, including people from payments, product optimisation and development, legal, vendor management, compliance, money laundering and financial crime, as well as those who manage the bank’s reporting obligations.
Members of the exchange control team are also involved, as are some in forex operations and the digital and IT teams.
“And all this is married with our blockchain skills. If you have ideas and can add value to clients and solve problems, you can do things here [at Investec]. We’re approaching it a little differently. But it’s not easy. You just have to keep driving things,” said Becker.