Infosys Finacle, part of EdgeVerve Systems, a wholly-owned subsidiary of Infosys (NSE, BSE, NYSE: INFY), and the European Financial Management and Marketing Association (efma) recently unveiled the 13th edition of the annual ‘Innovation in Retail Banking’ report, authored by Jim Marous, publisher of the digital banking report and co-publisher of The Financial Brand. Senior executives from over 1,165 banks and financial services companies from across the world participated in the study.
The key inferences in the report state that 14 per cent of the respondents — up from 7 per cent last year — said their organisation’s digital transformation had scaled, and delivering as expected. 64 per cent of the respondents believe that the pandemic has made them substantially more successful at innovation. Overall, more than half the respondents continue to rate their organisations’ digital transformation efforts as insufficient, similar to last year’s report. 57 per cent of respondents stated that their digital deployment was partial or that digital investments were not delivering as expected.
One of the areas that witnessed significantly accelerated innovation during the pandemic was digital delivery — from onboarding to service, and to engagement. Lockdowns and social distancing meant that banks had to expand the remote service of customers in an unprecedented manner. 44 per cent of respondents said they had increased investment in digital delivery by more than 10 per cent. Respondents expected enhanced investments in customer experience (78 per cent) and channels (72 per cent), which are key components of digital delivery, in 2021 and beyond as well.
Sanat Rao, chief business officer and global head, Infosys Finacle, said: “At a time when the banking industry was already struggling to drive profitable growth, the pandemic tested their resilience and agility to the core. The pandemic challenges accelerated digital transformation agendas at banks across the word, and consequently, banking innovation as well. Not surprisingly, digital delivery saw some of the highest action, and this trend is expected to continue in 2022 as well. Also significant in the findings, was a higher acceptance among bankers of the dramatic changes that are disrupting their business, as well as the need for sustained, holistic business model innovation to stay relevant.”
John Berry, CEO, efma, said:“This year has yet again proved that the financial services industry continues its evolution towards digital banking transformation. Even the most innovative players are now facing strong competition from big tech companies and of course, fintechs. It is essential that they must continuously innovate in order to stand out from the competition. Customer engagement is still centre stage for future success.”
Jim Marous, owner and CEO of the digital banking report, said: “This year’s innovation in retail banking report shares the digital transformation progress of financial institutions in the 18 months since the pandemic disrupted banking. Moving beyond pandemic-driven crisis management, financial institutions of all sizes have made significant strides in re-imagining the purpose and structure of innovation within banking and are integrating data, analytics, modern technology, and process automation to provide improved customer experiences. The research results shared in this year’s innovation in retail banking report provide a guide for strategic planning and investment prioritisation for banks and credit unions globally.”