2016/08/30 6:00 PM
A new report, issued by the Massachusetts Institute of Technology (MIT), explores the potential of digital banking, including the possibility of a world without banks.
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MIT Report: Legacy Banks Stuck in a Malaise
The report, contentiously titled “Digital Banking Manifesto: The End of Banks?” was published in August and authored by Alex Lipton, David Shrier and Alex Pentland of MIT’s Connection Science Department.
In it, the researchers look over the lack of innovation in the banking sector and how it compares to other industries, including retail, travel, communications, and mass media. They say, contrasted with these industries, the banking sector has essentially hit a brick wall in innovation.
They offer up a diagnosis of the situation, suggesting that the lack of innovation is a result of “weak competition” between banks, which subsequently leads to other problems,…