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White Paper

Bank of the Future


Between now and 2020, most banks will adopt advanced technology solutions to comprehensively serve customers regardless of the geographical spread. With customer-centricity becoming the driving force, the industry will witness an obsolescence of the existing operating models and structures. As the regular branch and cash management functions gradually lose their relevance, a more fundamental change will be observed in how banks service and man age their customer relationships.

In our interactions with customers, prospects, and industry analysts, there appears to be a perpetual debate about how banking will be conducted in the future, with the following emerging as key themes.

  • Will banks be needed?
  • Will branches be needed?
  • Will technologies eradicate the traditional needs served by banks?
  • How will new entrants change the dynamics of the banking industry?
  • Will banks deal with more than just money?
  • Will biometric authentication take off in its true sense?
  • Will customer obsession follow customer service and customer experience?

In this paper, we shall discuss these seven themes and propose the most likely scenarios for banks of the future.

Clearly, the banking industry is set to change but it will be an evolution for most banks. Banks will evolve from transaction processors in branches to digital processors on the internet. Banking products will move from integrated accounts that are provided on a subsidized basis through cross-selling to fragmented account services accessed through the cloud on a pay-on-demand basis. Customer access to the bank will no longer be determined by the branch distribution model but will move to a model with digital distribution as the core. Banks will be differentiated based on how well they are able to use human relationships to augment digitized structures and services.

In terms of developments in the industry, we do not expect new and unconventional entrants to decimate traditional banks nor do we anticipate the replacement of cash by bitcoins. Instead, the future appears to be one of hybrid operating models, with banks working closely with innovative organizations to incorporate new ideas, such as the block chain, into their core products and services. At the same time, the incorporation of technologies such as video service channels and biometric authentication does not imply that core services developed so far will be wiped out. Rather, technology will augment and differentiate the existing services. welcom

In summary, the future of banking is the same as it has always been: different, but the same.