Open source has become a movement and a way of working that reaches beyond software production. The open source movement uses the values and decentralized production model of open source software to find new ways to solve problems in their communities and industries. One of the industries that has historically lagged behind others is financial services.
To understand the importance of open source technology in financial services, Digital Journal caught up with Gabriele Columbro, general manager of the Linux Foundation Europe and executive director of FINOS.
However, Gabriele Columbro and his organization FINOS (Fintech Open Source Foundation) have made major strides in the area of open source financial software area. FINOS has more than 60 members including American Express, Capital One, Citi, Goldman Sachs, JP Morgan and many others.
Digital Journal: How has open source in financial services grown in recent years and what is its impact on our modern economy?
Gabriele Columbro: We’ve seen major strides in open source over the last several years across an increasing number of industries. While financial services has been our primary focus, leading names throughout the buy and sell-sides, cloud service providers (CSP’s) and regulators, among others, have pledged their support for the widespread adoption of open source. Contributions of significant projects and continued improvements to existing projects, like FDC3 2.0 to support streamlined desktop interoperability between financial institutions with enhanced connectivity capabilities, exemplifies the positive reception of open source software throughout all industries.
From an economic standpoint, the implementation of open source software reduces developmental costs and allows organizations to allocate funds away from building proprietary technology to more worthwhile business efforts. Closely related, collaboration through open source also avoids the issue of costly vendor lock-in. Additionally, we have the power to decrease time-to-market and drive innovation at a rapid rate through accelerated product development. In light of the labor shortage, it’s also important to note that open source talent is increasingly in high demand and creates an abundance of open positions across multiple industries. In short, open source is saving organizations time and money alike. Why reinvent the wheel?
DJ: What is the importance of the commercialization of open source in today’s economy?
Columbro: As the global fintech market continues to grow, even in today’s economy, open source standards can serve as a highly beneficial business model for these organizations. Especially for early-stage fintech firms, commercial open source unlocks revenue strategies that allow startups to build grassroot engagement without the sales and qualifications processes. Fintech entrepreneurs are then able to produce organic revenue free from external investments. With a well-established base of customers and source of revenue, these firms become more attractive to VC’s and other investors.
DJ: What is FINOS and The Linux Foundation’s role in the open source movement?
Columbro: FINOS and the Linux Foundation have long been the primary proponents of the open source movement. Beyond being the vehicle behind open sourcing a multitude of member projects and working closely with leading institutions to build their business model to include industry collaboration, organizations such as ours work tirelessly to expand the benefits of open software beyond financial services.
In the past year, we’ve welcomed buy-side institutions like Wellington to establish streamlined data connectivity with the sell-side, and have even brought on Google Cloud as our first global cloud service provider. FINOS also works to enable and promote opportunities for open collaboration on regulatory compliance initiatives, thereby driving forward innovation in the regulatory space. We aim to deliver an unprecedented level of value not only to our members, but the larger span of industries who stand to benefit from open source. Annually, FINOS and The Linux Foundation host our Open Source in Finance Forums (OSFF), one in London and one in New York, with the NYC-based event coming up on December 8th. These are dedicated to driving collaboration and innovation across financial services, in addition to our State of Open Source in Financial Services survey which provides an understanding of the state of open source adoption, contribution, and readiness.
DJ: What does The Linux Foundation Europe mean for the global growth of open source?
Columbro: Announcing The Linux Foundation Europe and my role as General Manager was another huge milestone in progressing the widespread adoption of open source on a global scale. Our ability to accelerate the growth of open source efforts geared toward the opportunities and challenges of European counterparts provides a stepping stone for projects and companies in this region to succeed through collaboration. Excitingly, The Linux Foundation Europe has already announced its inaugural project, the Open Wallet Foundation (OWF), which is a new collaborative effort established to develop a digital wallet engine supporting interoperability for a wide range of use cases. Over the course of the next year, we will work to generate global participation through our structure for technology collaboration within the unique European model.
DJ: Any exciting upcoming projects or announcements you’d like to share?
Columbro: We are beyond thrilled to host our annual Open Source in Finance Forum (OSFF) on December 8 in New York City, and explore various topics such as FDC3 2.0, the state of DE&I, Open RegTech, digital payments, security, central bank digital currencies and more. We look forward to sharing insights from our expert member base, including leaders from Capital One, Cosaic, GitHub, Glue42, Goldman Sachs, Google Cloud, IBM, JP Morgan, Morgan Stanley, Red Hat, Symphony and others. We will also be announcing the results of our State of Open Source in Financial Services survey to provide key data on the current open source landscape, and expectations going into 2023.