However, I don't believe 'open-source' is the correct model for the financial industry. Wall Street, Banks and the rest of the large institutions have shown themselves capable of inventing increasingly complex (and damaging!) financial instruments that do not properly contain risk mitigation plans, and selling higher risk to all who don't have time to analyse things correctly, or are so cash-strapped that they take on risk out of desperation.
What I do agree on is that we urgently need more transparency and simplicity in the financial sector. I believe that the increasing number of cooperative and private banks popping up is a good signal of this. Unlike normal banks, they are more like a club in which members define what the bank policies are – and there are a number of rather interesting alternatives in this area, if you are not concerned about their extremely small size. What we are missing, then, is consolidation of these small, new alternatives into something scalable that can compete with the larger banks, and unifying their policies to establish the new post-revolutionary banking standards.
Loughborough professor calls for ‘open-source banking’
The future of the UK economy depends on the switch to ‘open-source banking’, according to Alistair Milne, Professor of Financial Economics at Loughborough University.