Adoption of Open Banking has been sluggish: Reports
Banks must collaborate with start-ups to remain relevant as the financial ecosystem evolves from ‘Open Banking ’ to ‘Open X ’
75% of tech-savvy customers are currently using at least one financial product from a BigTech, according to World Retail Banking Report 2019. Open Banking is evolving to become ‘Open X’, where banks and new non-traditional players join forces to deliver banking services that integrate with digital experiences in other parts of customers’ lives.
In an era of rising consumer expectations, banks are challenged to offer their customers a consistent engaging experience across all channels – branch, web and mobile – and evolve from the Open Banking approach towards an Open X mindset, where banks and new non-traditional players join forces to deliver banking services that integrate with digital experiences.
“Banks that identify their top capabilities and then seek partnerships with FinTechs and other business sectors to enhance their offerings in other areas will be the most successful” said Anirban Bose, CEO of Capgemini’s Financial Services Strategic Business Unit and Group Executive Board member.
The report reveals top three reasons customers say they turn to financial products from non-traditional players are lower costs (70%), ease of use (68%), and faster service (54%). Of customers likely to switch their primary bank in the next 12 months, more than 80% are currently using payments, cards, or banking account products from BigTechs and challenger banks or are likely to do so in 3 years. Adoption of Open Banking has been sluggish with only 33% of banking executives saying they have effectively implemented it.
Retail banks are struggling to deliver a positive last-mile experience as customers demand more comprehensive and personalized banking, according to the World Retail Banking Report (WRBR) published by Capgemini and Efma.
The World Retail Banking Report 2019 outlines where banks are falling behind customer expectations and the steps they need to take to become inventive banks.