Having cut half of its branch network in 2016 to focus on digital development, Norway's DNB is rolling out a range of incubation and startup initiatives to accelerate its vision of becoming "a technology company with a banking licence".
In the first half of the year, DNB reduced the number of branch offices in Norway from 116 to 57 to reflect changing customer behaviour.
"While the use of digital services has exploded in recent years, there has been a prolonged decline in the number of visitors to our branch offices," says Rune Bjerke, group CEO. "Ninety per cent of Norwegian banking customers no longer use branch offices for their daily banking needs. Nine out of ten Norwegians cover their banking needs online, and an increasing number now use their mobile phone or tablet."
He says the number of visits to its mobile bank has increased from 700,000 to 17 million per month during the last three years, adding "even though we have closed half of our branch offices, we have never talked more with our customers than in 2016".
Nor are the changes confined to the consumer banking market, with similar traits emerging in small business banking. The bank yesterday announced a programme to downsize and restructure its corporate banking centres with the loss of 100 jobs to better serve the needs of the nine out of ten companies who now establish their customer relationships digitally.
Reflecting the switch to digital, the bank in 2016 undertook a number of initiatives to further spur innovation across the group. Am Nkr100,000 Digital Challenge to students at the Norwegian University of Science and Technology, generated three ideas to redefine the future of banking - including the creation of a 'Fintech Platform' to establish an ecosystem for cooperation between DNB and startups, improvements to mobile banking services, and a startup accelerator for growth companies called NXT.
"The Fintech Platform is now a DNB project which we are in the process of developing,” says Halvor Lande, head of digitalisation and business development in DNB. "We already regard DNB as a technology company with a banking licence. In order to conquer the competition, our ambition is to become one of Europe’s leading technology companies."
The bank has also launched the NXT accelerator in cooperation with StartupLab, selecting five companies to begin the three month programme this spring. Participants will receive access to up to Nkr1.3 million and be followed up daily by Norwegian entrepreneurs and DNB’s business and IT experts.
Says Lande: “This is the first in a long series of cooperation projects we will have with large and medium-sized technology companies, both nationally and internationally. Even though we are more than 10 000 employees in DNB, we are still too small to be able to stay one step ahead in all the areas necessary to ensure that we maintain the required pace of innovation."