Back in February of 2019, Lloyds Banking Group announced it was enhancing its integrated banking solution for its customers. This week it announced yet more improvementsto come in 2019. The latest upgrades will allow customers to see savings and credit card information all in one place – a mobile app.
The OpenBanking initiative is behind a lot of the innovation we are seeing today. The question remains can the large well-established banks compete with the smaller challenger banks and online accounting services? Are the major banks an unstoppable force that will soon crush the upstart banks? Do the smaller banking-like services have the advantage of agility and a better understanding of their target audience?
John Mongelard manager for Risk and Regulation in Financial Services Facultysays, “Despite the seven-day switching standard and three figure cash incentives, current account switching is still relatively trivial. It languishes near 3%. Simply people find it difficult to compare providers because they have a package of products with a bank, not just one. However, I still think banking in the UK is very vulnerable to a new firm disruptor. It’s only a matter of time. The new apps are so much easier to use and the new firms don’t have the cost base from bricks and mortar channels. The idea of a modern-day Millennial traipsing to a high street of the past and spending and a couple of hours doing a mortgage application, rather than clicking on an app is ridiculous. Many of them have never set foot in a bank branch and many never will.”
Today’s technology allows organisations to establish new ways of working quickly. However not all new services are successful, and many are abandoned quickly. Google+ anyone? One of the lessons the tech firms learnt in recent years is that failing is no bad thing, often lessons can be learnt as a result. This may not be a bad thing when applied to non-financial technology. However, just how will this work in a regulated industry?
Do you think the bigger banks have a chance of surviving?