Fit for the future: how tech is transforming the banking industry

The report talks about PA Consulting's Vision for Banking report which revealed a key threat; The growing financial services market share of big techs such as Apple, Amazon and Google will force banks to digitise further to remain competitive.

How to combine the best of neobanks and incumbents

Commenting on how to combine the best of neobanks and incumbents, Jason explains: "Banks are continuing to respond to these challenges by accelerating technology investment to make services more flexible, cost-effective and customer-centric. They are also learning from others, for example, Amazon’s customer experience; and partnering with fintechs to integrate innovative solutions."

The article highlights that, according to the Vision for Banking report, another differentiator for traditional banks is that they prioritise environmental, social and governance (ESG) and the ability of finance to support sustainability more than tech firms. Banks cannot afford to de-prioritise this issue as social and environmental risks are among their gravest long-term threats.

Jason adds: "Banks have again responded by renewing their focus on purpose, emphasising positive social impacts and aligning strategies with stakeholder needs. Purpose-driven banking helps foster a sense of direction and enables innovation."

Banks tool up for the future of payments

Commenting on the ISO 2022, Mark explains: "ISO is a huge opportunity, but it is also causing significant disruption in overhauling national infrastructure, internal systems and decades of knowledge rapidly. We expect banking interfaces to change to include the extra data on invoices, marketing details and further contextual information."

He says: "This change could be overwhelming for customers as banks start communicating what ISO means for them and how the once straightforward process will evolve overnight. But all participants can benefit by leveraging the increased data. If they haven’t already, banks should start considering how they want to leverage these benefits.

Mark adds: "This could be through more efficient transaction monitoring or new value propositions for customers. Banks should also be educating corporate customers – including big tech firms and retailers – about their operational readiness for ISO 20022 and how they plan to use the additional remittance and contextual data."

How to seize the opportunities of purposeful banking

Oliver shared some PA research on this, which showed: "67% of banking leaders see the “conscious consumer” at the centre of their future business models. This means aligning products, such as mortgages and investments, with customers’ ethical views so that they feel their investments support initiatives which are important to them."