Boston’s financial sector at the forefront of technological innovation
December 2024 — Artificial intelligence, blockchain, and other emerging technologies are reshaping lending processes, improving customer experience, and enhancing cybersecurity, all while preserving the relationship-driven nature of banking, industry leaders said at the Invest: Boston launch conference.
Speaking before an audience of regional leaders at the UMass Club, panelists discussing “Tech influence: How technology is changing lending decisions, and how that will reshape the business landscape” explored the transformative role of technology in the financial services industry that is making the region a fintech hub.
“The incubators and accelerators here make it easier to partner with cutting-edge technology companies,” said Kristin VanBeek, president and CEO of Rockland Federal Credit Union. He cited collaborations with Posh AI and Dora Financial as examples of successful partnerships driving innovation in the sector.
The annual event’s final discussion was moderated by Chris MacKenzie, growth leader at LGA LLP, and featured panelists VanBeek; Joseph Campanelli, CEO of Needham Bank; Ryan Bailey, president and CEO of Cambridge Savings Bank; and Daniel Griggs, president of the Greater Boston region at OceanFirst Bank.
Boston’s financial ecosystem has allowed institutions to remain competitive even as the banking landscape evolves, the speakers said. Campanelli emphasized Boston’s strengths: “This is one of the best banking markets in the country — its creativity and innovation make it a remarkable place for financial services.”
Artificial intelligence was a key theme during the discussion, with panelists exploring its dual role as an enabler and a disruptor. “AI is both a blessing and a curse,” said Campanelli, reflecting on its potential to enhance processes while introducing new vulnerabilities. He highlighted applications like voice recognition and multifactor authentication as critical tools in fighting fraud and enhancing security.
Bailey added that AI is transforming customer service by enabling faster, more personalized interactions. “We use AI to identify customers and integrate data from over 30 systems so agents can resolve issues almost immediately,” he said. This focus on seamless service underscores the importance of maintaining the “high-touch” relationships for which community banks are known, even in an increasingly digital world.
As financial institutions adopt advanced technologies, cybersecurity remains a top concern. Campanelli noted the importance of staying ahead of cyberthreats, emphasizing the need for robust fraud detection systems and secure interfaces. “The dark web is terrifying,” he said. “We must ensure our systems aren’t just efficient but also resilient against evolving threats.”
Griggs highlighted how technology has enabled OceanFirst Bank to expand geographically without relying on physical branches. “Our investments in treasury and cash management technology allow us to serve clients in Boston, Baltimore, and beyond — all without a brick-and-mortar presence,” he said. This approach reflects a growing trend where financial institutions leverage AI to enhance customer experiences and streamline operations.
While blockchain’s reputation has been tainted by its association with cryptocurrency, the panelists agreed on its potential to revolutionize banking. VanBeek described blockchain as a tool for transparency and security, with applications ranging from payment processing to mortgage transactions. “Blockchain could streamline complex processes like loan closings, making them faster and more efficient,” he said.
This perspective is reinforced by industry analyses highlighting blockchain’s capacity to revolutionize mortgage origination. By providing transparent and tamper-proof records of loan contracts and payments, blockchain can enhance efficiency and reduce fraud in mortgage transactions. Campanelli added that blockchain’s distributed ledger system offers unparalleled accountability but he warned of the risks associated with integrating it into existing systems. “It’s a journey,” he said, emphasizing the need for cautious implementation to avoid vulnerabilities.
For community banks like Cambridge Savings Bank, technology must enhance — not replace — their local focus. Bailey described how the bank’s digital platform, Ivy Bank, serves as a national deposit-gathering tool while enabling local lending. “By attracting deposits nationwide, we can lend more to our local communities, furthering our mission as a mutual bank,” he said.
Similarly, VanBeek stressed the importance of aligning technology with customer needs. “Technology should simplify, not complicate, our members’ interactions with us,” he said, pointing to Rockland Federal Credit Union’s upcoming core system conversion as an example of modernizing for better service delivery.
The panel concluded with a forward-looking discussion on the role of technology in shaping the future of banking. While the adoption of AI, blockchain, and other innovations continues to accelerate, the panelists agreed that the human element remains essential. “It’s about the convergence of high-tech with high-touch,” Campanelli said.
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