digital innovation in retail banking - verdict · digital innovation in retail banking john mahon...
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Digital Innovation in Retail Banking
John Mahon Head of Product Research and Strategy EdgeVerve R&D Lab
Our Most Recent Survey
140 senior bankers
Broad response base
7th year running
Respondents by Country Income Level
High income : GDP per capita > Int$30,000 e.g. United States
Middle income: GDP per capita Int$15,000-30,000 e.g. Hungary
Low income: GDP per capita < Int$15,000 e.g. China
$ 21%
$$ 37%
$$$ 42%
Key Findings
84% prioritising
investment in digital channels & customer
experience
57% consider analytics
a major disruptive force alongside mobility
41% see startups as
evolving threat
72% cited significant
industry disruption
Increasing competitive threat
10%
18%
27%
31%
41%
45%
73%
70%
63%
63%
50%
48%
18%
12%
10%
6%
9%
6%
0% 20% 40% 60% 80% 100%
Insurers
Retailers
Telcos
Banks
Start-ups
Tech companies
High Neutral Low
Threat of Industry Disruption from New Players
Using a scale of 1 to 7, the categories are High (6 or 7), Neutral (3, 4 or 5), Low (1 or 2)
With new technologies impacting the sector…
57%
Advanced
analytics or
big data
59%
Mobile
technology
53%
Open APIs Internet of
Things
47%
They are voting with their feet
Customer expectations are changing
The banking customer is taking control
They have alternatives
• Traditional banks
• New banks
• Start-ups
• High Street retailers
• Online retailers
• Payment providers
• Mobile operators
• Peer-to-peer intermediaries Have actively looked to open / close accounts
50%
Have more than one banking relationship
73%
60%
Go online to pay bills / make transfers
Source: E&Y Global Consumer Banking Survey 2015
Banking customers want
• A provider they trust
• Consistent, interactive digital experience across all channels – one view of their bank
• Fair prices
• Flexible, personalised products and services
• Amazon like experience
…and evolving customer segments driving change
Source: Goldman Sachs Global Investment Research's Future of Finance 2015
33% believe they won't
need a bank in 5 years
Less than half have a credit
card
84% say UGC & reviews
influence their decisions
Only half expect to use
cash weekly by 2020
50% are counting on
tech startups to overhaul banks
Millennials as agents of change:
Truly Digital Banking
69% of banks don’t have a systematic digital strategy
Our research indicates that only
31% of organizations believe they have
a systematic digital strategy
Truly digital – What it’s not
Just adding new channels
Adding delivery of banking services on new devices
Enhancing same old banking business models with digital technology
Giving legacy processes a digital facelift
Automating existing processes without reimagining
+
+ +
x
Truly digital banking paradigm has four standout characteristics
The customer is the focal point
Ecosystem before bank
Insight ahead of everything
Ubiquitous automation
Degree of digitization increases
Renewal
Classical
Adaptive
Shaping
Visionary
Decide on your strategic approach
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FINACLE POWERS
16.5% banked population
Banks across 84 countries
Over 547 million customers
of the world’s adult
14
Thank you [email protected]