Six digital growth strategies for banks
Despite the headlines about digital disruption in financial services, big banks are actually holding their own. Globally, financial-services revenues have grown 4 percent annually over the past ten years (thanks largely to growth in emerging markets), and fintech start-ups and large tech companies have so far captured only tiny slivers of market share.
But digital technology and big data/analytics are still poised to shake up the financial-services industry. Investors believe fintech start-ups will become a significant force in the future, valuing those in the US at $120 billion, or 7 percent of the total equity of US banks.
As we see it, many banks haven’t set their sights nearly high enough in response to disruptive attackers. They’ve been overly cautious, playing defense, with me-too digital initiatives primarily designed to counter moves by actual or potential disruptors. Even banks that would like to be more aggressive find it difficult to know exactly what to do. Large banks—like many incumbents—have been inundated with new technologies and business opportunities, leaving them confused about where to focus and dissipating their resources.
Most big banks have the tools and advantages to push the boundaries of their existing business models. And they’re certainly motivated. What hampers their progress is uncertainty about how best to build on core strengths to create sustainable outcomes.
To provide a structure for navigating this chaos, and to galvanize the shift to bolder thinking, we’ve identified six opportunities for banks to fuel future growth.
