The banking sector has been, and continues to move, through a considerable transformation – from addressing the issues arising from the 2008 financial crisis and the current COVID-19 pandemic to shifting to a much more digital operating and distribution model. Our industry is evolving rapidly with new challenges to address and significant opportunities to pursue.
Digital transformation has accelerated
In this pursuit, banks need to take fresh looks their distribution channels, embrace the fact that many clients have been forced quickly adopt to digital interactions and quickly identify ways to lower costs while still enabling growth. Digital transformation has accelerated more rapidly across the Nordics than elsewhere. We are living in an ever more digital economy where operations work seamlessly between the physical and virtual and where online services, digital currencies and contactless payments are becoming the norm.
New risk models and strategies need to be adopted
Equally, the evolving environment we are working and living in demands more resilient processes, teams and organizations. New risk models and strategies need to be adopted to ensure new challenges across cyber, third-party risk, financial resilience and others are managed successfully. These new solutions, many of which are automated, need to be created to share the cost-of-compliance so that the banks can focus their attention, and spend, on improving customer experience. Not to forget the need to keep pace with the evolvement of regulatory requirements and the environmental, social and governance (ESG) agenda.
The banking new reality will challenge many old truths and organizations that dare to break new ground will last in the fierce competition to come.
We have identified six key trends against which bank’s performance will be critically important as they position themselves for the future.