Independent Banker - January 2021 - 26

PORTFOLIO INNOVATION STATION
4. Cybersecurity. Cybersecurity should
be a part of any bank's comprehensive,
strategic approach to fi ntech and
innovation initiatives. ICBA's Preferred
Service Provider Directory is an
excellent place to look for solutions
geared to meet community banks' needs.
6 innovation trends
for 2021
By Charles Potts, ICBA
s we start the new year, much
remains uncertain. In general,
" uncertainty " implies a state of limited
knowledge that makes it impossible
or impracticable to describe a future
outcome. And it's this ambiguity that
many community banks face when
addressing market needs for 2021.
Despite this, community banks will
continue to demonstrate a thoughtful
and courageous approach to innovation
to meet the needs of their customers.
Here are six opportunities for
community bankers to consider as
they fl esh out their 2021 planning.
1. Digitalization. Demands on
community banks to process
Paycheck Protection Program
loans for small businesses in 2020
accelerated digitalization and laid
a strong foundation for future
innovation around digital products
and services. Investing time and
resources into digitalization in 2021
is non-negotiable.
A
2. Artificial intelligence and
machine learning. Expect a
heightened focus on using AI
and machine learning to improve
digital and mobile-fi rst strategies
and support front- and back-offi ce
processes. Processes enhanced
by these tools include ever more
complex regulatory compliance,
know your customer (KYC) risk
management, and Bank Secrecy Act
(BSA) and anti-money laundering
(AML) requirements from an
underwriting perspective.
3. Regtech. Leadership changes
at the national level often correlate
strongly with increased activity
around regulatory needs, changes
and technology. This may result in
a shift in the tools and technologies
community banks employ to meet
the needs of their markets. ICBA
will continue to focus on the regtech
space and apprise members of
new developments.
5. Financial literacy. Look for
heightened awareness and increased
demand for solutions to serve
underbanked and underserved people.
Several new entrants appeared on the
scene in late 2020 to address fi nancial
literacy and fi nancial wellness needs
of these communities. This will be an
essential year for increased awareness
and adoption at the national level.
6. Cryptocurrency. In 2021, expect
to see more robust and solid use cases
for cryptocurrency. The year will bring
opportunities for community banks to
adopt some of these capabilities to serve
targeted subsets of the market.
Equally important is your continued
involvement in ICBA. ICBA's
ThinkTECH Accelerator 3.0, which
launches Jan. 6, provides community
banks with opportunities to engage
directly, partner with early stage fi ntechs
and help shape the future of community
banking. Visit icba.org/thinktech and
sign up to lend your expertise and
insights as a mentor.
As we look to the future, Benjamin
Franklin's words come to mind:
" Nothing can be said to be certain,
except death and taxes. " And I would
humbly add, community banks'
resolve to serve their customers and
communities well. 
Charles Potts (charles.potts@icba.org)
is ICBA senior vice president and chief
innovation off icer
26 Q ICBA Independent Banker Q January 2021
http://www.icba.org/thinktech
Independent Banker - January 2021

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