Ohio’s financial services industry reaches people all over the world. The state is home to the fifth largest financial services sector in the country, with Fortune 500 and Fortune 1000 companies including Huntington, KeyBank, Fifth Third Bank, Progressive and Nationwide, as well as key operational centers for JPMorgan Chase and State Farm. There’s also a burgeoning fintech and insurtech startup ecosystem that has spawned disruptors like CoverMyMeds. When you combine these resources with some of the best tech talent in the country, it is clear that Buckeye state has something to cook for. This unique equation – coupled with significant statewide investments, collaborative partnerships, and operating costs at half the cost of states like New York and California – has created a formula for Ohio’s financial services companies to lead the way in technology advances and applications.
In August 2018, Ohio passed law recognizing the use of blockchain technology to store and secure electronic records in a number of industries. This achievement underscores the importance of informing policy makers who understand the opportunities and community benefits that new, cutting-edge technologies can offer.
Ohio-based SafeChain has now set the tone for the practical application of the technology with its SafeWire product that enables real estate companies to close deals faster while reducing the fraudulent liabilities of securities service professionals. Now the technology that was most widely discussed as the driver of Bitcoin 18 months ago has a real and practical application that can solve a $ 400 million fraud problem in the real estate industry. The Columbus-based startup recently completed its first title transaction with the Columbus auditor’s office over blockchain. The process was completed in just 30 seconds.
Blockchain is also a major focus for JPMorgan Chase’s Finlab, an innovative fintech collaboration supported by Jobs Ohio and Otterbein University.
The potential of blockchain to improve much-needed security, limit current manual processes and give customers more control and transparency over how transactions are completed is enormous. Many financial firms across the state have added blockchain-based companies to their investment portfolios and are investing in research to explore the blockchain, while others are setting up in-house teams and partnerships to study and implement the technology.
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Artificial intelligence and machine learning
Technologies like artificial intelligence and machine learning are also having a significant impact on the banking and insurance industries in Ohio. And while the foundations of artificial intelligence have been around for years, the technology’s implementation is just beginning to accelerate, benefiting from advances in the efficiency of cloud computing and data processes.
Upstart Network Inc., a Silicon Valley-based company that created the first credit platform to use artificial intelligence and machine learning to evaluate credit and automate the credit process, recently selected Columbus as its new research and development center. The new center will help Upstart build a larger national presence and benefit from the skilled technology workers in Ohio at half the cost of Silicon Valley.
Innovation laboratories and partnerships
It’s not just the startups that are innovative. Traditional companies of all sizes recognize the need for advanced technologies for the industry that will enable them to provide better products, services and experiences to their customers. As a result, innovation labs and unique partnerships are emerging across Ohio that are used to rethink business operations, improve efficiency, and identify emerging needs and opportunities with customers.
In 2017, Fifth Third Bank added a new innovation lab to its Cincinnati office, redefining what it’s like to work in the financial services industry in a traditional office environment. In September 2018, JPMorgan Chase formed a unique partnership with Otterbein University and Jobs Ohio to set up a Finlab research and development center on the school campus. There, employees from various disciplines work directly with students to think outside the box and develop real solutions to challenges.
BMW Financial Services, headquartered in Hilliard, Ohio, recently launched a collaboration lab in partnership with UK-based innovation company L Marks. The country’s eighth largest auto insurer, Nationwide, announced plans to build a 31,000-square-foot innovation center in the heart of Columbus in 2018, developing new ways to help members protect themselves and plan for a financially secure future .
Financial services and technical talent
The continued growth of Ohio’s financial services sector requires a highly skilled workforce. With 220,000 Ohioans working in the industry, Ohio’s leading banks and insurers, as well as growing startups, have leveraged the state’s list of highly acclaimed colleges and universities that produce nearly 45,000 financial services graduates each year.
Developing this talent pipeline and harnessing the potential of our future employees will be key to sustaining growth and change in the industry. More and more companies are working strategically with Ohio learning institutions to navigate the landscape of innovation and change.
Ohio’s business-friendly climate provides an ideal environment for financial services companies large and small. When I travel home and abroad, I am honored to hear from people about the exciting dynamics that Ohio companies are experiencing.
Ohio has what it takes to become the technology of choice for financial services in the United States, much like Ireland is in Europe. The existing financial services ecosystem, business-conscious regulators, cost-effective operating costs, and abundant millennial talent are all here to welcome those interested in a soft landing and strong growth in Ohio.
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