Open banking is just the start of a decades-long movement that will fundamentally change the financial services industry. It will create a booming new ecosystem in which the competition for customers is fierce. And although we believe banks are well positioned to win the race, there’s no room for complacency.
As transformation picks up pace, banks are facing a tidal wave of opportunities, challenges and threats. Not least from a consumer perspective, where the service they get has become far more important than the financial institution that delivers it.
In our recent open banking survey, we quizzed almost 270 financial executives across Europe, and found that over half (56%) believe consumer loyalty towards banks will be significantly reduced because of open banking, and 48% are trying to reduce banking fees associated with accounts to appease customers. But customers are ready for a bigger change.
A pioneering new generation of banking leaders are rising to the challenge to create truly customer-centric services. Here is what they’re doing well – and what you can do in your organisation to come out as a winner.
1. Build a digital business by caring for the customer
Banks need to become technology companies and build digital businesses because at this point, the risk of disintermediation is too expensive to ignore. All of this requires investments in talent, culture, operations – and most importantly – services that deliver customer value. This also means metrics like customer impact and net promoter scores (NPS) need to be at the heart of everything you do.
2. Transform your organisation by working with fintechs
Fintechs are renowned for their ability to take new services to market within a matter of days or weeks. For any bank, scaling up a standalone app or service can be expensive when you consider processes, risk and compliance. Working with fintechs gives banks low-risk access to the latest, cloud-based technology – and the chance to innovate at a much greater speed.
3. Operate as a data-driven bank
Open banking is inviting businesses and third parties to transform the data that’s inside and outside a bank, and convert it into meaningful offerings. Banks now have the opportunity to access data from other players, and add value and smart services on top of it – for their own business and for their customers.
To read the full report with all of the survey data and related insights on how executives see the challenges, opportunities and threats of open banking, download your copy here.