Banks are at risk of falling behind in the financial services space in the wake of technological transformations such as blockchain, ex-Barclays boss Antony Jenkins has warned.

In an interview with CNBC, Jenkins said that banks “tend to be quite good at innovation”, but that “transformation is much harder for them”, at the same time as being the focus of many FinTech challengers.

Jenkins explained: “If you think about it, if just you and I lived in the world and you had money, I needed money, we’d do that between us. There are billions of people in the world, so we have a banking system. But what a banking system does is have a series of centralised counterparties that tend to concentrate on risk. And when you concentrate on risk you have to have a lot of capital underpinning that, and it creates friction in the system.”

He added that the banking system’s focus on central authorities and middle men acted as a hindrance to progressing blockchain technology. Jenkins suggested that the full potential of blockchain was close to being realised, despite being generally ignored by mainstream financial services.

“I think this is like all technological developments we see,” he said. “It starts off quite small and on the periphery of life, and most incumbent players – in this case the banks – tend to ignore it and sort of hope it will go away. And then they begin to pay attention to it and do a few experiments in it.”

Jenkins launched his own FinTech venture in October last year, 10x Future Technologies, designed to give banks greater access and insights into customer data through a digital banking platform, enabling them to offer products such as mortgages and loans that are more tailored to customer needs.

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