At EBAday 2019, hosted by Finextra in association with the EBA, it was revealed that 81% of banking executives would collaborate with partners to execute digital transformation most effectively.
Further, 8% would build a new operating layer on their own, 6% would outsource processes and only 5% would create a new bank “on the side”. Finextra’s The Future of Payments 2019 report highlights that this year has been the year of digital transformation for legacy-era brick-and-mortar banking giants.
Financial institutions have been forced to step up their game in order to keep up with consumer demand and push out several different products and services, leveraging emerging technologies, to provide customers with choice. Today, retail customers can deposit cheques, transfer funds and apply for loans from their mobile devices, signifying that we are in the age of the application.
When EBAday attendees were asked how they would describe digital transformation, 55% said it means fully changing an institution’s fabric, while 20% said that it meant offering more innovative products while reducing costs, 13% said replacing and renewing the core banking operating system and 12%, offering digital channels such as mobile.
It is the combination of digital technology, modern development and delivery practices that has resulted in the advancement of innovation by challengers in the financial sector, who are also able to develop new customer experiences at an increasingly rapid pace.
Traditional banks with legacy systems have found it challenging to match this pace. However, with the advantage of a large existing customer base, market presence and strong capital, combined with the ability to also partner up with fintechs, incumbent banks are starting to rise to the challenge.
Read more about the implications of digital transformation, the regulation vs. technology battle and the new era of P27 in Finextra’s The Future of Payments 2019 report here.