In recent research by the Digital Banking Report, close to 90% of organizations indicated that they have increased their focus on digital banking transformation since the pandemic, with over 60% indicating that they had established new partnerships and alliances with either fintech firms or third-party solution providers. Despite this increased attention to digital transformation, however, the vast majority of financial institutions globally have concern about their organizations’ ability to respond to the digital and technological prowess of large legacy banks, fintech providers or big tech competitors.
The question becomes, will traditional financial institutions do what is required to respond to new marketplace norms, or will they fall further behind? Put more simply, will banks and credit unions put themselves in a position to survive and thrive in a new digital banking ecosystem?
Balancing Act: Organizations must balance today’s immediate needs against the need to be agile and resilient in the future.
While there is agreement that digital banking transformation is required, the playbook for success is less defined. Financial institutions of all sizes must prioritize digital transformation strategies that address existing shortfalls, while building a platform for future innovation and competitive advantage. This requires changes in back office processes, infrastructure, legacy culture, and in the skills and talents needed to execute new business models.
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