Retail Banking 2020. Evolution or Revolution
According to PwC ‘Powerful forces are reshaping the banking industry. Customer expectations, technological capabilities, regulatory requirements, demographics and economics are together creating an
imperative to change. Banks need to get ahead of these challenges and retool to win in the next era.
Banks must not only execute on today's imperatives, but also radically innovate and transform
themselves for the future'
Check this amazing story:
Anna, 56, boards a high-speed train for her commute to one of the world's emerging
megacities. She settles in and blinks twice, activating the display in her glasses. She is
authenticated by retina scan, and reviews her messages.
A message from her financial adviser notes they sold her holdings from a recent IPO and
transferred the proceeds into a new African high-tech fund. She made this decision after
consulting with her financial adviser and reviewing recommendations from several
independent investor analytics engines she reached through her bank's wealth
She then watches a message from the bank's leading education expert, suggesting it is
time to set up a university savings account for her 13-year-old son. The adviser asks
whether Anna expects her son to attend the new flagship online university, or a much
more expensive residential programme overseas. She quickly outlines the estimated
costs and benefits of each, taking into account Anna's age and planned retirement at 70.
She recommends the flagship, and suggests supplementing her son's education with less
expensive summer programmes in Mumbai, San Francisco and Beijing. Anna agrees, and
the adviser seamlessly sets up the savings account and the auto-deposit.
At lunch, Anna browses the local electronicsdisplay, where the latest holovision catches
her eye. A quick scan from her glasses returns customer recommendations, coupons and
financing offers from multiple providers including her own bank (which itself has
instantly reviewed the returns from the scan to ensure their offering is competitive).
She makes her choice and completes the purchase, using a new peer-to-peer lender
that offers a more competitive rate, due to a lower cost structure, thanks to a lack of legacy
infrastructure and a less stringent regulatory regime.
The next day, Anna accepts an invitation for a video conversation with her bank business
adviser. The bank had been monitoring the favourable social media coverage Anna
has been receiving and concluded that her business might need additional services.
The business adviser has already arranged for a commercial estate agent and loan
officer to join them, and they discuss Anna's questions and offer advice on a range of
small business topics. She shares that she is thinking of expanding her business into
additional locations, and they explain the difference between the bank's products and
the government small business facility, which offers less service, but a lower rate of interest
and longer repayment periods. Also, Anna is passionate about environmental protection.
The bank recognises this, and through its own programmes and partnerships, is able
to present an offer where Anna's use of the bank's products results in direct donations to
Anna's favourite charity.
She accepts - happy she has found a bank that really seems to understand her.
DOES THIS SOUND LIKE YOUR BANK? It doesn't sound like mine! 2020 - Evolution
This amazing study covers two key areas:
· The impact of global macro trends
· 6 priorities for banking
Send a copy of this book to YOUR bank compliments of PricewaterhouseCoopers.
This PwC report Retail Banking 2020: Evolution or Revolution reveals that more than half (55 per cent) of senior retail bank executives believe non-traditional new players are a threat while 31 per cent believe they present innovative partnership opportunities.
The findings are based on a survey of 560 financial services executives from leading institutions in 17 countries. It also incorporates insights from PwC's global network and its Project Blue work on the future of financial services.
According to the report, 54 per cent of executives believe big banks will retain their dominance in 2020 despite the rise of new players.
Asian Pacific and Emerging Market bankers are most likely (71 per cent and 79 per cent) to consider how global trends (economic growth, regulation, demographic growth and technological changes) will impact the industry in 2020 - compared with the US and Europe, 61 per cent and 67 per cent respectively.
For more info go to www.pwc.co.nz