The pandemic has catalyzed change in industries around the world, and banking is no exception. In our latest report “Will COVID-19 be a watershed moment for banking?” we surveyed 200 banking executives in the UK, Spain, Germany and France in partnership with Coleman Parkes to find out how they intend to adjust their strategies in response to the COVID-19 pandemic.
According to our findings, COVID-19 has had a significant impact on almost all (96%) European banks, with over three-quarters (78%) planning to change their future banking strategy to adapt to changes in consumer behavior, such as the accelerated adoption of digital banking services and cashless payments.
Our new report had other clear takeaways regarding the state of digital transformation in banking:
COVID-19 accelerates demand for digital banking services
As a result of the growing demand for digital services, 80% of banks have accelerated their plans to digitally transform. Banks also predicted that digital transformation projects will need to be delivered in two-thirds (69%) of the time, with 89% saying that the COVID-19 pandemic has drastically increased the speed of change in banking from years to months.
Future banking strategies require innovation
Over three quarters (76%) of banks say that the impact of COVID-19 has meant that the business models they used to follow have changed forever. With 92% of banks acknowledging that innovation is more important than ever, they will need to increase the number of innovative services they offer to consumers. Banks said that the main areas they will need to innovate on include improving their data analytics to help customers make lending decisions in real time, the ability to better use contextual data to make judgments on fraud in real time, and technologies that enable them to control what loans are being spent on.
Banks have to change quickly or risk falling behind
COVID-19 has shifted consumer behaviors and the adoption of new technology. All banks surveyed acknowledged their plan to increase investment in tokenized card technology and modern card programs. They also acknowledged that the dangers of not being able to keep up were real. A significant portion (38%) said that without innovation in payments they would be unable to scale their existing services to offer new features and capabilities, while more than a third (34%) said they feared losing market share to competitors.
COVID-19 has ushered in new urgency for digital transformation in banking. Executives say they are compelled to keep up with the need for innovation or risk losing out to competitors. Download our full report here.