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Banks have spent decades perfecting control: regimented processes certified by regulators, risk teams combing every corner, and sprawling systems designed around stability. If a bank were a spacecraft, its autopilot would be locked and the mission fixed. That discipline is a strength — but also a limit. Systems built to eliminate every risk also shrink the space for experimentation and failure.
The paradox of control
Large banks can and do innovate, but only if they create deliberate zones where trial, exception, and deviation are permitted. Banking’s imperatives — trust, capital adequacy, reputation, regulatory compliance — create powerful incentives to avoid experiments that might ripple into the core. Over time, risk-aversion hardens into risk-fear: a minor operational mishap sparks board scrutiny and the instinct becomes “don’t try anything that could fail.” That mindset kills more ideas than any competitor.
Controlled chaos: the necessary middle ground
“Chaos” here shouldn’t be read as anarchy. It means purposeful tension: a space between total standardisation and unchecked disruption. Complexity science calls this the “edge of chaos,” where adaptive systems are most creative. In practice, controlled chaos looks like small, autonomous teams inside banks that think like startups — rapid cycles, minimum viable products, continuous user feedback — while remaining within governance guardrails.
These teams intentionally seek friction as a learning signal. Friction isn’t the enemy; it shows what the system can tolerate and where new opportunities lie. Without it, organisations only refine existing practices instead of discovering new possibilities.
Internal venture units as probes
Banks don’t need to wait for outside fintechs to force change. They can create internal venture units or skunk-works that operate with startup logic but leverage institutional advantages: brand trust, compliance expertise, balance-sheet strength, and distribution channels. When structured well, they create a dual operating model: one engine keeps the core business running, while the other peers into future business models and technologies.
These ventures act as probes into tokenisation, AI, embedded finance, and nascent asset classes. They let the bank reclaim agency over transformation rather than outsourcing disruption to external challengers.
Designing for experimentation
You cannot simply “unleash chaos” and hope for outcomes. Deliberate design is required: pick the team, set governance, allocate budget, define metrics, and give a clear mandate. For banks, this includes explicit compliance path-threads, information-security fences, and reputational thresholds — plus the latitude to pilot, fail, and learn.
Key design elements:
– Psychological safety: let teams know early failure is part of learning.
– Clear but permissive boundaries: define what can be experimented with and what is off-limits.
– Robust feedback loops: run small pilots, measure differently from core metrics, iterate fast.
– Funding and metrics tailored to exploration, not only short-term financial returns.
When this architecture is right, internal units become labs that test product-market hypotheses, user behaviours, and technology feasibility, while escalating issues transparently when needed.
Lessons from practice
I’ve seen both sides. In one environment, a minor product glitch prompted severe retrenchment; the immediate reaction was to shut down further experimentation. That kills momentum. In another, small teams were allowed to build, test, fail, and report openly. Those teams produced meaningful experiments around tokenisation and AI-driven services that respected regulatory constraints yet expanded what the bank considered possible.
Why standard disruption narratives miss the mark
Much commentary presumes banks will be displaced by lean fintechs. That underestimates banks’ embedded role in the economy, their capital bases, and the structural frictions fintechs must navigate at scale. The smarter bet is not on extinction, but on reinvention from within. Research and practitioner evidence suggest innovation only improves performance when paired with adaptive structures and governance.
Who will stay relevant
As tokenisation, web3 primitives, AI, and embedded finance accelerate, banks that cling to rigid control risk irrelevance. Those that combine disciplined control with intentional experimentation will lead. They will better explore new business models, partner with communities (gaming, digital natives, tokenised-asset ecosystems), and launch ventures that are client-first, technology-enabled, and institutionally credible.
Conversely, treating innovation as a one-off program or consistently outsourcing it will leave banks out of the next value cycle. Value will accrue to institutions that restructure from inside — not those that wait.
A final note on intent
This is not advocacy for chaos for chaos’s sake. It’s a call for controlled chaos: a deliberate design of productive tension inside the system — autonomy within alignment, exploration within responsibility. Done right, it lets banks maintain what makes them indispensable while discovering what they might become.
Ala Aljayyusi
Ala Aljayyusi is the Managing Director of CBIx, where he leads strategy, operations, and venture-building initiatives connecting traditional finance with emerging technologies. He joined CBIx after five years at Commercial Bank International (CBI), serving as Senior Vice President and overseeing retail products and segments. Ala has held senior leadership roles at Deutsche Bank, Barclays, DIFC, Dubai Properties, Mawarid Finance, and Tamweel. With two decades in the industry, he combines regulatory understanding, product expertise, and market insight to build responsible, measurable innovation.
