The COVID-19 pandemic pushed consumers into using digital channels at a pace never imagined, with online banking use increasing 23% and mobile banking use increasing 30% during the pandemic. These changes are likely to be permanent. As consumers continue to move further online, it is becoming clear that non-bank players are making strong inroads into traditional banking spaces and threatening the position of financial institutions. In response, it is time for financial institutions to rethink and realign costs in order to remain competitive.
This most important part of this is for them to identify value streams that are important for consumers and redesign, digitize and integrate them front to back. Not only will this help reduce costs (by an estimated 15–25%), it will also increase the average consumer advocacy (or net promoter) score by 20–40%. In fact, leading financial institutions have already started doing this, and the rest need to follow suit or risk becoming a thing of the past.
Explore this issue in greater depth in this Global Retail Banking Report published by the Boston Consulting Group.