Evolution of Banks in the Digital Age

The Digital Age has turned blind unconnected banking clients into a smart, social and purposeful audience. Some banks have started to evolve in this new environment, using APIs to foster an open, innovation, bottom-up-culture; and some have started to focus on the essential: how to stay relevant and capture the attention of a new generation of users. The winners are those providing superior experience to their users and employees, to keep differentiating in an environment attracting new species -Tech Giants, Telcos, and new species : Neobanks, and Scale Up Fintechs. This presentation proposes a framework to discuss digital transformation as adaptation, evolution and selection of species in the Digital Age. First provided at Apidays.io London, Nov'19

Transcript

1. Aboard the Beagle Evolution of Banks in the Digital Age Eric Horesnyi Apidays London Nov’19
2. Banking in the 2000s
3. Fitness Agility Can’t fly, can’t run Acquisition Picking, not servicing
4. Culture Flocking No Innovation Closed No Collaboration
5. Analog Client Communication No network, no culture Uninformed Limited Senses Expectation Fly from preys, eat
6. Digital Client Communication Social Having fun Simple experiences, volatile Smart Care about their Financial Fitness
7. Environmental Change
8. What happened ? The Digital Age
9. APIs drive Selection of Species in the Digital Age
10. NeoBanks & Fintechs : New Species fit to thrive
11. Telcos getting into Banking
12. Tech Giants now adapted to the finance ecosystem
13. 2 Billion People Off-Bankables in 2020
14. Facebook: 124 Patents in Wealth Management
15. Apple Wallet in Financial Wellness Mastercard Credit Card & Goldman Sachs PFM
16. Cache – Bank Accounts by Google
17. Google in Insurance So much data to make any actuary dream
18. 90% Mobile Payments are Off Banks in China, in just 5 years
19. Open Banking: Banks opening to APIs
20. Topdown Instructions Vision Engage Employees Inspire Centralized Distributed KPIs OKRs Projects Products Closed Open Introverted Extraverted Market Share Mindshare APIs for Cultural Change
21. Evolution of Banks in the Digital Age Denial Open Banking APIs to drive Change Bank-as- a- Product Bank-as- a- Platform
22. Bank evolutions Product Fit Sight Design Experience Agile Fast Continuous Improvement Purposeful Improve the financial fitness of users
23. 23 Experiences that Matter Simple, Relevant, Multi-Domain UX IT is complex
24. • Challenge: build Customer Journeys = seamless real-time end-user experience with fragmented IT • Data structure, eg in private banking: —A customer builds its financial fitness plan with —Customer detailed information –kids, neighborhood, owner/renter, married?- in Bank databases —Lead management in —Forms & emailing via —Service Management in —Rating provided by {The Bank Mortgage API} —Event: an apartment becomes available for sale according to Product Manager Retail Banking
25. Customer Service: Prioritize Incident Management based on Customer Lifetime Value Integrated Customer Journey Post Moment: young couple looking for apartment in Stamford, CT {The Bank Moments API} Get Profile Client Database Get Housing in criteria Stream Updates as Patch Event 1 apartment match {The Bank Mortgage API} Get Authorization based on Profile Create Lead Send Recommendation
26. Design Simple Experiences from Complex IT Opportunity • Build meaningful experiences • Attract new audience • Increase Attention Time Risks • Vendor locking : some Sirens seem to offer it all: quick race to a trap • Security breaches across domains • Disjointed Experience Complexity • In private cloud • In public cloud • Behind internal APIs • Behind external APIs
29. 40% of business through APIS B2B2C Platform with Partners COURTIER RACHATS DE CRÉDITS Pre-subscription of mortgage repurchase dossier SCORING DILIGENSE The Share Service Center DiligenSE, operated by BNPP PF, exposes its scoring services for all BNPP entities. CHECK PERSON (SCAL) Compliance API to check person status, at disposal of BNPP entites. GRANTING & DECISION The way for partners to grant and have a pre-decision for credit dossier proposal. LOAN ORDER MANAGEMENT Provide to retailers the status of their credit application and some basic operations (purchase cancelation, order cancelation). WS CREDIT AUTO Support the entire process of automotive loan subscription (quotation, upload supporting docs, get decision,…). FINANCEMENT EXPRESS
30. APIs : 72% of new account acquisition New account creation by an annual growth rate of 68.1% Loan Origination & Wealth Management
31. Banks can also become Digital Platforms
32. Singapore Airport – ATM Age
33. Singapore Cab – Digital Age
34. A 7-year long evolution to Agile & API-First
36. DBS Q3.19 profit climbs 15% to S$1.6b, beats estimates Stock: from $7 to $27 over 10 years
37. Platforms do not compete in an ecosystem They are the Ecosystem
38. Evolution of Banks in the Digital Age Denial Open Banking APIs to drive Change Bank-as- a- Product Bank-as- a- Platform
39. Thanks ! Images Wikimedia Foundation Britannica Inspiration Axway Customers