COMMENTARY: TRANSFORMATION Breaking bad: The COVID wrecking ball has exposed weaknesses and strengths
Banks post-Covid: The uncomfortable truth Fintech influencer and publisher of the Digital Banking Report, Jim Marous, is famous for telling it like it is. Here he discusses the report’s latest findings and questions if the wrecking ball of the pandemic will finally lead to true transformation There now appear to be two acceptable ways of feeling about COVID-19 in the banking world. Surveying the damage exacted on corporate budgets, customer numbers, employment rates, and personal lives across countries and sectors, it’s understandable that the first, gut-felt reaction is one of deep sadness and unease. The second focusses on the unexpected upsides of the pandemic and how banks managed to pull rabbits out of hats to weather the storm.
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But, as a growing number of banking executives interpret COVID as the incentive they needed to rip up old floorboards and deliver innovative products that would have otherwise taken years to roll out, there’s another truth emerging, too: of a polarised industry where the niche players and the behemoths prosper, leaving the vast majority in the middle squeezed. That’s according to fintech influencer, co-publisher and face of The Financial Brand, Jim Marous, and it’s one of a number of findings revealed in his most recent Digital Banking Report. Being privy to banks’ internal conversations provides reliable but disquieting insight, and it’s led Marous to conclude that, notwithstanding the impressive somersaults banks performed during the crisis, and the enormous impact that had on keeping the economic wheels turning, the impediments to true digital transformation that existed before the pandemic have not been fully overcome.
‘True’ innovation The World Economic Forum’s How Digital Innovations Helped Banks Adapt During
COVID-19 implied that the floodgates to transformation have been opened, But In one of Marous’ recent Banking Transformed podcasts, guest Sanat Rao, global head of Infosys Finacle, which provides core products to 200 banks, warned against interpreting such commentaries as the whole story. “One should not get too excited about the fact that, as a result of this transformation, innovation has really been accelerated… It is easy to pass off many changes as a result of innovation but I don’t think all of them can necessarily be categorised as that,” cautioned Rao. He used the example of UK banks increasing the contactless spending limit from £30 £45 at the start of lockdown, to underline the difference between true innovation – that being the fundamental rethinking of a system – and spontaneous change brought about by necessity or law. “No one wanted to touch cash, people weren’t able to interact physically. There was no choice,” he pointed out. According to his definition of innovation, only a handful of recorded initiatives during www.fintech.finance