From now until the year 2022, financial services giant HSBC will eliminate 35,000 jobs as part of an effort to increase its technological platforms. In addition to the massive job cuts, the international bank will also shut down hundreds of branches around the world, particularly in the United States, where the company expects to reduce its brick-and-mortar locations by at least 30%.
The announcement by HSBC was made as a part of its quarterly earnings call, which was welcomed by investors because it doubled the previous quarterly figures, also mentioned that the bank is moving strongly towards a digital future. Over the next two months, HSBC will put the final touches on its own blockchain application to hold about $20 billion in assets. The HSBC Digital Vault project comes at a time when rival banks have already implemented blockchain solutions, and some of them have done so at the retail banking level.
The Slow Pace of Financial Technology at HSBC
If it seems as if HSBC is moving slowly in terms of fintech innovation, it should be noted that this is a bank that is under scrutiny and pressure from financial regulators around the world for its previously lax standards in terms of "know your customer" practices. The company has gone from being known as "the world's local bank" to a very conservative outfit where it is now difficult for individuals to open simple savings accounts unless they are prepared to go through a rigorous process of ID verification.
Although HSBC has no plans for the use of digital currencies, this may change in the future as it continues to expand the internal use of blockchain solutions. The bank is still interested in the retail market, but mostly in the Middle East and Asia, where they have not as many barriers or competition in terms of offering mobile banking services. Some HSBC letters of credit have already been issued on a proprietary blockchain application for smart contracts, but the company now wants to move away from hard currency assets to a digital system that provides greater flexibility.