Digital business in banking


December 2017

A survey for Gartner run by Efma shows that banks are convinced of the need to embrace digital banking and to transform themselves. But our interactions with banks show clearly that what that ambition really means, how it will affect them and how to make it work in practice, are all far less certain.

Key findings
• 90% of banks surveyed expect that they will become an ‘open bank’ within 3 years, i.e. a bank that selectively shares data, transactions, algorithms or other capabilities with its business ecosystem partners.
• Banks are ambitious – the IT spend on digital transformation is substantial and a large majority embraces actively such initiatives as innovation, fintech and hackathons.
• Banks struggle with cultural change and – despite their grand ambitions for the nearfuture – the current focus is on low risk (but also low benefit), internal, employee-only, digital platforms.

Recommendations
Bank CIOs with responsibility for the digital bank should:
• Help your peers to understand the importance of digital banking and digital platforms by explaining what they are and the new business models they enable (from adapt to disrupt).
• Avoid the “build-it-and-they-will-come” fallacy by purposefully building a business ecosystem and requiring global operations to adopt the digital platform.
• Change culture by adopting the traits of a ‘digital leader mindset’.

Keywords : Digital/Mobile channels , Bank Products & Services , Operational excellence/Cost efficiency , API/Open banking