Sibos fun, games and gamification

After a week of Sibos, Virginie O’Shea founder of Firebrand Research provides a quick summary of the event before looking at the concept of gamification in financial services.

It has been a busy Sibos week, with discussions this year focusing heavily on key industry agenda items such as sustainability and operational resilience, and a little lighter on the pure technology conversations of the past. I feel like the panels managed to avoid the “technology will solve all our problems” mantra of some of the previous years and instead take a more practical approach to change, with some sobering conversations about climate risk and cybersecurity. It wasn’t all serious though. I think we’ve managed to adapt quite well to a bit of virtual networking and we had some fun with Slido voting and interactive sessions throughout the week, not to mention the pub quiz, which was excellent as always.

I’m sure today will feature a lot of blogs and features about what you might have missed at the event, so I encourage you to read them all and hear about how ransomware as a service has become a big thing for cybercriminals and find out about SWIFT’s new securities tracking service. I’m not here to discuss those topics today, instead, the topic of fun and games has been on my mind for the last month or so.

First, we have the insane popularity of Netflix’s Squid Games that has swept the globe and the resulting memes (finreg, fintech and otherwise). And then we’ve had the regulatory discussions about gamification. Gamification relates to the use of game-like features in trading apps such as points, rewards, leaderboards, bonuses, and competitions, which are all targeted at increasing customer engagement. But is all gamification bad and how do you police it?

The Securities and Exchange Commission (SEC) and the European Securities and Markets Authority (ESMA) have both been pretty vocal about their concerns related to the gamification of retail trading over recent months. The SEC’s Gary Gensler has indicated the agency will soon be producing a paper on the topic, sparked by the memestock discussions with politicians earlier in the year. In his recent testimony to the US House Financial Services Committee, Gensler noted that the use of behavioural prompts to influence trading behaviour based on data analytics is squarely in the frame of its investigations.

However, we’ve gamified many aspects of our day-to-day lives, from the number of hours we sleep to how fast we run on a treadmill, everything can be turned into points or bonuses. You can even reduce your life insurance by enabling your insurer to track these data points. And that’s one of the biggest concerns that regulators have: this data can be used for positive, client experience improvements or to tailor pricing to real-world stats, but equally it can be misused and turned against the consumer or investor.

It will, no doubt, be very difficult to draw parameters around what constitutes negative gamification on the part of the regulators. Policing this stuff will be even harder and require some very tech-savvy individuals to keep an eye on the underlying analytics. No wonder Gensler is looking for a budget increase.

In the meantime, though, I’d suggest that gamification could be a positive force in other areas. The next generation of employees will have grown up online, playing Fortnite or Roblox with their friends. Why don’t we think about gamifying aspects of the working environment to keep these individuals engaged? How many tasks could be improved by adding a competitive or fun element? Obviously, this would have to be done very carefully, but it could improve the quality of working life for a lot of people working in the middle- and back-office in particular. You don’t want to encourage risk-taking behaviour but making tasks more entertaining in some way might keep people engaged in functions such as operations for longer.

Fintechs are constantly thinking about improving UX but rarely do they go the extra mile to look at the enjoyment factor. It may sound crazy to some, but as long as you’re careful that the right behaviours are encouraged and caution is taken during difficult tasks, I see no reason why we can’t start thinking beyond simplicity and ease of use when it comes to UX. If nothing else, the last two years have taught us how we live our lives incredibly online, why not make work better for everyone? Just as long as we don’t go the Squid Games route, no one wins in that scenario!