Allied Irish Bank (AIB) has radically overhauled its approach to technological innovation, adopting a start-up culture in a bid to get new services to market in weeks rather than years.
Having taken a reputational hammering during the economic crisis and facing the threat of competition from technology giants such as Google and Facebook, as well as new, nimble financial services-related start-ups, earlier this year AIB decided to completely change its approach to innovation.
The bank set itself a deadline to build a mortgage processing mobile app from scratch in 13 weeks, COO Anne Boden told MarketForce's 'future of retail banking' conference in London.
By ditching big formal meetings and sitting down business and technology employees together, AIB managed to get a plan for the app together within three weeks and have it ready for customer testing after 45 days ahead of its launch just another 20 days later.
Boden says that the fruits of their labour is an app that slashes the time it takes for customers to go through the mortgage process from up to 10 days to less than a minute.
The start-up culture is about more than being quick, Boden says, it is also about breaking free of the bank's long-held prejudices. In contrast to technology companies, banks, she argues, have a tendency to try to work around big issues and problems, rather than tackling them head on.
When the possibility of an account opening app was floated at AIB, the assumption was that it could not be rolled out because regulations require customers to talk to a bank representative face-to-face.
However, when AIB went to Ireland's central bank to check, it found that no such rule is in place, it had always just been presumed so. An app was built, letting new customers open an account from their phone in 10 minutes.
Boden argues that banks that for many years were able to be complacent over customer retention now have to be quick and agile if they want to survive, giving customers want they want, when they want it at a price they want if they want to survive.
Other banks have taken a similar approach: Barclays established a start-up culture when building its hugely successful Pingit app in just 90 days before throwing it out to customers and then tweaking it based on feedback gathered via social media.