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Responsiveness & Agility Emerge As Key Competencies For Banks

Sitting in the C-suite of any bank means a lot of time thinking about how to remain competitive, how to win market share and how to protect what you already have. One of the most important emerging capabilities being flagged up by this group is agility. In fact, 68% of banking CEOs believe that without agility, they would be facing bankruptcy.

And agility isn’t just a matter for survival, it’s essential for business growth too. 69% of banking CEOs say that growth is dependent on their ability to challenge and disrupt any business norm. Agility is a critical competency for achieving this kind of disruption.

The banks that will win in our increasingly digital future are those who are able to respond quickly through effective banking innovation programmes. They need to be able to act fast to meet new demands and seize market opportunities as soon as they arise, before the playing field becomes crowded. On the other hand, they need to respond quickly to any emerging threats to their market share, before any serious erosion can take place. At the heart of this is the tactical practices of deploying new features, products, services and tools to stay ahead of the digital curve.


The last year has forced banks to be more agile

Since the emergence of COVID-19, banks have had to act fast and launch new digital products and services at speed. In the Far East where the coronavirus crisis first took hold, a leading Singaporean bank introduced digital account opening and a new content platform for SMEs to help them navigate the new business environment. In China, there have been numerous examples of lightning fast pivots and new launches.

Heading west where the situation is newer, there are starting to be more examples of digital innovations launched or scaled over a short time period to address the needs generated by the crisis. 

In the UK, digital signatures have replaced wet ink in most settings and the administration of the UK Government’s “Bounce Back Loan Scheme” for businesses by leading banks such as Barclays and Santander is being conducted entirely online with funds reaching applicants' bank accounts within 24 hours. The UK mortgage sector has seen most lenders move to automatic valuation models for lower value and pre-existing properties.

In the US, financial institutions such as Idaho Credit Union have rolled out newer technologies like video banking. And it is likely that more, bigger and braver digital strides will continue to be made, with banking giants such as Deutsche Bank announcing an imminent innovation leap based on deploying AI and machine learning through cloud applications.


How Banks Can Embrace Agility

As with learning anything new, it’s easiest if you lean on a more experienced party who’s already very competent in the capability you’re trying to develop. And in the case of agility and responsiveness, the fintech sector is streets ahead of more traditional financial institutions.

In addition to the benefit of being exposed to their partners’ organisational culture and behaviours, banks can leverage fintechs to hit the market with the end-to-end digital products and services customers need now. There exists a real opportunity to improve overall time-to-market and time-to-value by using fintech solutions that have a pre-existing platform that can be easily configured to your specific needs, instead of the time and expense of doing a custom build from scratch.

With what is predicted to be the most serious economic downturn in many decades unfolding and radical shifts in customer engagement patterns being observed, the future is uncertain in almost every sense apart from the likelihood of its difference to what went before. Digital agility will help banks not only rise to today’s challenges, but will also set them on the path to future growth.

Banks need small but strategic thinking in a crisis. Read on to learn more about five ways banks can keep innovating whilst keeping risks low.

Key Ideas

  • Agility is key when it comes to banking innovation
  • Banks should focus on building partnerships with fintechs who are already very competent in being agile
  • COVID-19 has accelerated the need to be responsive and adaptive to change