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GCC Digital Banking Survey
Arabnet16 December 2015
Every Sector impacted but in different
ways
20Years to catch up with the cyber-security skills
shortage
Opportunities--------------------------------------------------------------------------------------
Digitised OperationsInnovation & InsightEmployee & Customer engagement
Speed & Scale
New business models
Threats----------------------------------------------------------------------------------
Cyber attacksMega-Vendors & Start-
upsTransparency of
everything
RegulationSpeed of change
Strategy Business model
Product InnovationMarketing Sales Service
Operations Supply Chain
RiskHR
FinancePartnersCompetitor
s Eco-System
52%Digital disruption has
demolished 52% of the Fortune 500 since 2000 (Constellation Research)
Globally, the Digital megatrend creates both opportunities and threats impacting organizations from top to bottom
We have conducted a survey to gain a specific view of Digital disruption for banks in the region
► 2000+ customer surveyed in Saudi, Kuwait, Qatar and UAE
► 80 C-level leaders interviewed at 30 top GCC banks
► Fintech watchdog► Interview of regulators
ey.com/mena/digitalbanking
In a recent research*, EY has evidenced a strong correlation between the customer’s digital experience and the bank’s revenue in the GCC
“Up to 50% of bank profit is at risk for the digital laggards in the GCC”
EY Research – GCC Digital Banking Report 2015
but only 14% of transactions are
processed on digital channels
98% bank customers are equipped with
modern smartphones
Social
Internet of Everything
SaaS
Three out of four GCC banking customers would be ready to switch bank for a better digital experience.
Omni channelAnalytics
Social
Cloud
Robotics
88% use their smartphones daily for
popular mobile applications
The vast majority of customers expect Digital to enable them to bank anywhere / anytime
64% rely on social media as a source of
information for their banking decisions.
and 80% customers consider the lack
of convenience of mobile banking is holding them back
* Src: GCC Digital Banking Report 2015 – EY Primary Research Publication
An improved digital experience can also enable a comfortable growth for the digital leaders
For an improved digital experience…
of customers would increase payment usage.
of customers would increase credit facilities usage.
of customers would increase credit card usage.
of customers would increase savings usage.
of customers would increase investments usage.
71% 57% 57% 51% 43%
22%InnovationsInnovation committees, innovation labs, regulator think tank and Fintech collaboration
95%Customer engagement
Online banking, mobile banking apps, social media
and wearable tech, as well as IVR, call centers, ATM and
CDM, and tellerless branches
62%Foundations
Systems and process automation techniques to
increase the level of straight-through processing (STP),
become paperless, improve the efficiency of back-office
operations and reduce processing costs
31%DifferentiationDigital assets such as data, products, rules or policies defined by banks to constitute a unique digital know-how
How do banks in the GCC define digital?2
What are the expected benefits of digital?2
1st
2nd
3rd
Business growththrough customer satisfaction to improve retention and net promoter score (NPS)
Operation efficiencyto support growth through enriched straight-through processing (STP), process automation and the elimination of process errors
Scalabilityto build the business quickly, with exceptional quality and lower proportionate cost increase
Digital is not just about cost reduction anymore, GCC banks rely on digital to enable delivering their growth plan.
What are the transformation challenges?2
Limited digital skills
Organizational silos and culture
Limited process automation
Limited technology support (legacy systems)
Regulatory environment
26%
21%
26%
32%
53%
5%
21%
26%
26%
32%
Larger banks Smaller banks
How digital leaders look like?2
Are selectiveBy dropping projects that do not show a clear path to revenue in six months
Stay mainsteamBy being ruthless and only retaining features used by at least 20% of their customers
LearnBy celebrating failures as an integral part of the innovation process; success usually occurs at the second or third attempt
Foster innovationBy encouraging the creativity of top talents, with incentives linked to successful innovation
EngageBy co-creating products, functions and experience
Market
leading digital
organizations
GCC banking industry leaders are asking EY their burning questions.2
1. How can we use innovation to gain competitive advantage?Are we doing enough?
2. How do I design an omni-channel service experience?What is the role of the branch in the digital age?
3. How should we transform to achieve leadership in the digital world?Are we ready for the future?
Take five
The five principles of digital acceleration
You know your customers, but you’re not treating them as if you do.
The future of GCC retail banking is a smartphone experience that delights; think beyond a killer app.
Not every technology is right for the GCC; place your bets wisely.
Get better at executing.
Digital shift is a cultural shift; collaborate to win.
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