Today I am looking at why I consider Barclays (LSE: BARC) (NYSE: BCS.US) to be an excellent stock selection.
New technologies to boost the bottom line
Barclays is leaning more heavily than ever on technology to deliver huge cost savings across the group, and to cotton on to the changing ways in which British customers do their banking. This commitment gives it the edge over many of its competitors and promises to charge earnings growth in coming years.
Indeed, bank chief executive Antony Jenkins said this week that “we are on the leading edge of a technology revolution. You can’t 
see it, but it’s coming, it’s coming hard, and it’s coming fast,” The Wall Street Journal reported. And Barclays’ top man underlined this trend by commenting that UK customers use mobile banking applications 24 times a month on average, comparing starkly with just two trips to the branch during that time.
The bank has launched a gaggle of game-changing technological innovations in recent times, including its Pingit service — now rolled out across all the UK’s banks but introduced by Barclays back in 2012 — which allow mobile users to make and receive payments using just a phone number, through to its bPay pre-pay wristbands introduced just this month which enable wearers to pay for their items by swiping their arms over contactless terminals.
Barclays has an enviable history of creating disruptive financial technologies that have revolutionised the way we bank today — after all, this is the company that installed the world’s very first ATM machine in North London back in the 1960s.
And Barclays rubber-stamped its commitment to technological innovation last week through the formal launch of its Barclays Accelerator support programme for ‘FinTech’ start-ups. The scheme promises to provide funding and expertise to eleven businesses developing a range of fresh technologies, from brand-new payment and loyalty cards for restaurant connoisseurs through to creating a cloud platform for financial instrument trade agreements.
With the role of the traditional bank teller becoming increasingly irrelevant due to the advent of new technologies, and Barclays investing heavily to lead the charge in this area, I believe that the firm’s plan to become the ‘Go-To‘ bank on the UK high street — facilitated by technological investment — should help to deliver blockbuster earnings growth in the long term.