Digital banking transformation has entered a new phase, with established financial institutions increasingly embracing innovation rather than reacting to disruption. While fintech startups initially appeared poised to redefine financial services on their own, banks have responded by investing in mobile-first experiences, digital partnerships, API-driven ecosystems, and customer-centric business models. As regulatory initiatives such as PSD2 encourage greater openness and competition, collaboration between banks and fintechs has become a defining characteristic of the modern financial services landscape.
The discussions at Mobey Day 2016 reflected this changing dynamic, highlighting how traditional banks were repositioning themselves as digital innovators instead of viewing fintech firms solely as competitors. Speakers emphasized that success would depend not only on adopting new technologies such as open banking APIs and blockchain, but also on strengthening customer trust, improving personalization, and creating seamless digital experiences. Mobile-only banking, strategic partnerships, and customer-focused innovation emerged as recurring themes, demonstrating that the future of digital banking transformation would be shaped by organizations capable of combining the stability and trust of established banks with the speed and creativity of the fintech ecosystem.
Sirpa Nordlund, Executive Director, Mobey Forum, shares key takeaways from the international association’s Mobey Day banking and fintech conference, held in Barcelona last week.
‘The banks are back’. If I had to use one phrase to reflect on Mobey Day 2016, this would be it.
For a long time alarm bells have been ringing for banks in digital and mobile financial services: the mass of new players; the scale of global VC investment; the rise of the fintech industry; the land-grab for mobile services. In many ways, all this excitement has put banks in the shadows. Finally, in 2016, things are different.
For the first time in five years, Mobey Day was hosted by a 100% mobile-only bank, imaginBank. This is important. Not just because imaginBank delivers a mobile-centric proposition, but also because it isn’t like other mobile-only banks. imaginBank isn’t chasing funding while trying to build an infrastructure, attract a customer base and apply for a banking licence all at the same time. imaginBank is part of the long-standing Spanish institution CaixaBank, which, having listened to its customers, has reinvented itself to serve a specific segment, developing an app-based service that has attracted 70,000 active customers within the first six months of launch. Who says banks are behind the times?
The tone and topics of this year’s presenters are other indicators that banks have re-taken centre stage; there was barely a tech-oriented presentation among them! Aly Mustansir, CMO of Bank Alfalah, Pakistan’s largest credit card issuer and acquirer, for example, chose to highlight that a bank’s customers are ‘ruled by emotion not reason’, and the real advantage of the digital revolution is that it gives banks the chance to develop true customer centricity. Too many continue to conduct very rudimentary segmentation, often between business and personal accounts only, he said. Through device-based services (‘the mother of all touchpoints’), however, banks can listen to, and learn from, their customers. They can then use this data to create lifestyle oriented brands that securing their relevance and, most importantly, add value. This is the chance for banks to ‘be the good guys’ for once!
Nordea Bank’s head of business innovation, Sophia Wikander, together with Demetrio Migliorati of Italy’s Banca Mediolanum, also adopted people-centric themes. Wikander highlighted the value of diversity when fostering innovation in new products and services, citing co-creation with customers, partners and start-ups as vital when developing an innovation culture. Migliorati wisely advised banks to develop a clearer picture of their customers’ emotional engagement with the banking services they consume. Insights here will uncover significant opportunities for banks to enhance their customers’ overall user experience.
Drawing on a career forged in security solutions, Neira Jones of the Emerging Payments Association also focused on customer perceptions, encouraging banks to differentiate between trust and security. Delivering secure digital services is, of course, is a pre-requisite for a bank, but it is trust that is a bank’s true point of difference in the digital age. So big is the trust-gap, she said, that ‘banks are from Mars and fintechs are from Venus!’
Continuing this theme, Peter Bosek, Chief Retail Officer of Austria’s Erste Group encouraged delegates not to be afraid of the big tech giants like Apple and Google. They will continue to do what they do regardless, he said, so as banks, we should focus on delivering great services and forging ever closer ties with customers. This will help banks retain the trust advantage.
With PSD2 around the corner, regulation was, unsurprisingly, another key theme running through the conference. Dennis Raabe, of Deutsche Postbank, encouraged banks to view PSD2 as an opportunity to overhaul banking operations. After all, ‘doing nothing’ is not an option for anyone; compliance with the regulation is a must and, given that banks have to invest, it makes sense to maximise their returns by building their own PSD2 ecosystem of payment initiation service providers (PISPs), something which will give them at least some level of control over their destinies.
A lively PSD2 group discussion, moderated by Mobey Forum Board Director, Kasper Sylvest of Danske Bank, delved deeper into this idea, exploring how the banks that prepare well for PSD2 can prosper from PISPs just as effectively as PISPs can prosper from banks. Thanks to the regulation, ‘open banking’ or ‘API banking’ is clearly here to stay and, despite the short term upheaval for banks, the regulation does look like it will achieve what it set out to do: foster innovation across Europe. It is now up to each bank to consider its own competitiveness, something that is likely to result in banks’ divergence of fortunes. Those that recognise the opportunity and move quickly to capitalise will compete effectively and establish clear differentiation. Banks that choose only to do ‘just enough’ to be compliant, are likely to slip further behind the curve.
No banking and fintech conference is complete without a panel discussion on blockchain technology, and Mobey Day’s didn’t disappoint. Moderated by Kristian Sørensen of Nordic fintech consultancy, Norfico, the wide ranging discussion highlighted a variety of issues facing the development of technology. Is it ever appropriate for a bank to file for a blockchain patent, regardless of how much investment it has pumped into its solution? Doesn’t this fly in the face of the whole idea of the technology? How does the permanent record established by a shared ledger align with an individual’s legal ‘right to be forgotten’? Could this issue be used by banks to obtain some level of master access for editing the blockchain? Indeed, could this legal entanglement enable the bank to regain some control over the new open landscape? What is certain is that banks are serious about blockchain and the intensity of interest in the technology is showing no sign of abating.
What did we learn? A great many things, but perhaps the clearest message of all was that the banks, often through collaboration and partnership with the fintech community, are back in the digital financial services game. Our industry has matured; fintechs need the distribution that banks can provide. Banks need the service innovation, digital expertise and technical capabilities of the fintech community. Collaboration has arrived and the customer will be better off as a result.
Now in its fifth year, Mobey Day 2016 was a bigger event than ever, attracting a record attendance. It seemed only fitting therefore for Mobey Forum’s Chairman, Jordi Guaus, to use the stage as a platform to announce opening of registrations for a new sister event, Mobey Day Toronto, hosted by Carta Worldwide on 7-8th December 2016. Perhaps I’ll see you there? Either way, I look forward to sharing more insights from across the industry when the time comes.
The evolution of digital banking transformation continues to demonstrate that innovation is most successful when financial institutions combine technology with a deep understanding of customer needs. Mobile banking, open banking initiatives, API ecosystems, and blockchain have all created opportunities for banks to modernize their operations while delivering more personalized and convenient financial services. Institutions that embrace collaboration and invest beyond minimum regulatory compliance will be better positioned to differentiate themselves in an increasingly competitive marketplace.
Rather than replacing traditional banks, fintech companies have become valuable partners in accelerating innovation across the financial services industry. As digital banking transformation continues, the organizations that successfully balance customer trust, regulatory compliance, technological innovation, and strategic partnerships will be best equipped to deliver the next generation of financial products and experiences.
