Changing customer behaviors and demands should be fueling change in the service and products retail banks are offering, according to an in-depth study released today by Temenos (SIX: TEMN), the banking software company.
The report, written by the Economist Intelligence Unit (EIU) on behalf of Temenos, explores the theme: “Whose customer are you? The reality of digital banking in North America”. This regional report explores the developing situation for retail banks in North America and derives from the recently launched global report written by the EIU and supported by Temenos.
The regional report emphasizes the need for North American retail banks to further embrace change by developing their digital marketing and engagement (cited by 53% of respondents) and improving product agility (cited by 49%). The report also notes that when it comes to preparing for digital change, American banks in particular need to examine the experiences of Europe and Asia-Pacific in creating a one-stop digital journey for their customers. Those with a global footprint especially can learn from Europe’s open banking experience.
Although concerns about regulatory fines and recompense orders are higher in North America (56% vs 43% globally), there is space for banks to work together to overcome the confusing mash of federal and state regulations. The report notes that banks in North America are already beginning to come together to collaborate – a necessary effort in order to build a truly modern banking system that supports innovation.
Renee Friedman, the editor of the report from the Economist Intelligence Unit, said: “North American banks need to be able to respond better to how their customers’ live now in terms of their digital offerings if they are to remain truly competitive against neo and challenger banks.”
Emily Steele, President – North America, Temenos, said: “Though we have strict regulations in place, nevertheless disruption is happening here in North America. We are seeing exciting developments across the region as the banking industry explores what it means to bank in a digital world. Incumbent banks are setting up digital banks alongside their own operations, challenger banks are popping up, and now we are starting to see fintechs moving to become banks themselves. Banks are awakening to the need to personalize and contextualize their digital products and services, and offer customers great customer journeys, in order to compete and remain successful.”