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NEWS


Banks should be getting ready for a digital-first, value-added future


B


anks should be prepared to cater for consumers wanting more value-added services, according to results from a CGI report titled Today’s Financial Consumer: Open for


Business.


The survey asked consumers to rank what features and services were most attractive to them, as well as which innovations looked to be adding the most value to their lives.


Unsurprisingly, security posed a major concern for respondents. Users also trust their bank to take care of their data and money – 61% said they hold banks accountable for moving, storing and protecting their money.


When it comes to new innovations in the industry, customers perceive the most value in services that prevent fraud and identity theft, with 80% identifying these products as key. Only 33% put current industry buzztopic robo-advice as a key value.


The survey also found that 73% of consumers are open to using a single bank account for all payments linked with a mobile app, without having the option of using alternative accounts. On top of that, 40% said they didn’t mind where their money was stored as long as access was easy.


“With the advent of open banking fast approaching, leading banks are leveraging their strengths in terms of customer access and trust while pushing into new innovative services through


Banks are increasingly relying on CGI to help them prepare for a digital-first future


“


partnerships with third-party providers, including both fintech startups and established technology firms,” said CGI’s vice president for global banking, Kevin Poe.


“Banks are increasingly relying on CGI to help them prepare for a digital-first future. Through partnership, innovation and service excellence, CGI transforms legacy technologies and operations and supports banks in embracing the exciting opportunities that are revealed as they move towards truly customer centric strategies.”


Tandem snaps up Harrods Bank U


K challenger Tandem Bank has completed its purchase of Harrods Bank, following regulatory approval from the Bank of England’s Prudential Regulation Authority and the Financial Conduct Authority (FCA).


The deal grants Tandem Bank a full banking licence, as well as access to Harrods Bank customers and £80 million ($114 million) of capital. The challenger also gains a £375 million mortgage book and more than £400 million in deposits.


Tandem Bank is in the process of rolling out a travel card and cashback card, and plans some “competitive savings products” in 2018. CEO and co-founder Ricky Knox told IBS Intelligence in a 2015 interview that Tandem aimed to be “completely different” from other challengers on the market.


Tandem Bank previously had the backing of Chinese conglomerate and House of Fraser owner Sanpower. It had been planning to stump up £29 million to fund Tandem’s capital requirements.


Sanpower eventually pulled out of the deal, owing to increasing government clampdowns in China aimed at stopping capital outflows. The deal falling through caused the bank to slice its staff levels, from 110 to about 80.


Reports that Harrods owner Qatar Holdings was considering a sale of the bank surfaced in early 2017. The bank had been suffering losses, with a pre-tax hit of £8.4 million in 2016.


The acquisition propels Tandem Bank up the maturity rankings, placing it among the most popular solutions on the market, including Monzo and Starling Bank. The challenger is sure to be undertaking a review of Harrods Bank’s product range and existing infrastructure.


Tandem Bank is a current user of Fiserv’s Agiliti platform. Agiliti is delivered on a pay-as-you-grow model, meaning that new entrants taking the system will have lower start-up costs than those that buy hardware and licence software themselves.


Two-thirds of consumers said that they felt they had lost a personal connection with their bank, but the same number also said that long-term relationships with banks were important.


www.ibsintelligence.com | © IBS Intelligence 2018


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