Digital transformation

Banking industry

TASK ASSIGNED GROUP STUDENT ID

MEMBER
1. Introduction to the Shoaib Ahmad 4128171
industry
2. Impact of digital Sahil Karim 4140454
technology
3. Impact of digital Islom Kurbonov 4107347
business models
4. Digital customer Sanaullah Sarker 4127342
engagement Saikot
5. Digital Kassab Abbas 4106954
organizational
culture
Introduction to the UK
Banking Industry
(Cont.)

• Industry revenue has been growing at a

CAGR of 0.3% over the last five years.
• The size of the UK banking industry was
£123.2 billion in 2023 (www.ibisworld.com,
2023).
• The demand for digital banking has been on
the rise in the UK.
• Around 86% of UK adults regularly use
online banking platforms as of 2023 (Boyle,
2024).
Introduction to the
UK Banking Industry

• The UK banking industry is a key industry to

the economy.
• Major players in the industry include
traditional banks like Barclays, Lloyds
Banking Group, HSBC, and NatWest Group
(Singh, 2019).
• There are some popular digital banking
service providers such as Monzo, Starling,
and Revolut.
• The industry is regulated by FCA and PRA
(Chiu, Kokkinis and Miglionico, 2021).
Introduction to the UK
Banking Industry
(Cont.)

• The core technologies being used in the

industry include Blockchain, Artificial
Intelligence (AI), Data Analytics, Biometric
Authentication and Cloud Computing
(Elsaid, 2021).
• The key challenges in the industry include
increasing competition from fintech firms,
regulatory changes, and cybersecurity
threats.
• The key opportunities in the industry include
the opportunity for innovation, collaboration,
and improved customer experience.
Impact of digital
business model
● Digital technology has transformed the
banking sector.
● It has a significant impact on the
banking sector and transformed the
way banks operate as well as deliver
financial services (Ganeshan, 2021).
Impact of digital technology
Digital technologies have had a profound impact on the
banking industry, revolutionizing the way banks operate and
interact with their customers. Here are some of the keyways
digital technologies have transformed the banking sector :
• Online and Mobile Banking
• Artificial Intelligence and Machine Learning
• Blockchain and Cryptocurrencies
• Big Data Analytics
• Cloud Computing
• Open Banking
• Cybersecurity
Impact of digital
business model
● Ecosystems are one of the cornerstones of future
banking.
● Platform business models have harnessed powerful
economic forces in achieving greater financial
inclusions (David Donovan, 2024).
Digital customer
engagement
• Introduction to Digital Customer Engagement in Banking
• Shift from Traditional to Digital Channels: Online
Banking, Mobile Apps, Social Media
• Key Technologies: AI for Personalized Banking,
Chatbots for 24/7 Support, Secure Biometric
Authentication
• Example: Bank of America's "Erica" - AI-Powered
Personal Assistant
Impact of Digital
Engagement on
Customer Experience

• Enhanced Customer
Experience: Convenience,
Efficiency, Personalization
• Increased Engagement:
Interactive Tools, Financial
Management Apps, Webinars
• Challenges: Cybersecurity
Threats, Digital Divide
• Future Outlook: Omnichannel
Engagement, Advanced
Personalization
Trends in Digital
Engagement: Banks
vs. Credit Unions

• Graph illustrating
comparative digital
engagement metrics
• Two-year trend comparison
(2018 and 2019)
• Notable increase in digital
engagement for both entities
with a remarkable rise in
credit unions in the latter half
of 2019

Average Number of Fintech Partnerships per Institution

Digital Organizational
Structure

Characteristics of a Adaptability: Embracing Innovation: Fostering Data-Driven Decision-

Digital Mindset change and agility to creativity and exploring Making: Utilizing data
respond to evolving new ideas to develop analytics to gain insights
market trends. innovative solutions. and make informed
decisions.
Digital Organizational
Structure

Change Management Strategies

-Communication: Clear, transparent
communication about digital transformation
vision, goals, and benefits. Engage employees,
address concerns, and solicit feedback.
-Training and Upskilling: Provide
comprehensive training to equip employees with
digital skills. Offer ongoing support for learning
and development.
Digital Organizational
Structure
Benefits of Agile and Lean Approaches
-Increased Flexibility: Enables banks to adapt
quickly to changing market demands and
customer needs.
-Enhanced Responsiveness: Facilitates faster
decision-making and delivery of
products/services, improving customer
satisfaction and competitiveness.
References
• Agarwal, S., Alok, S., Ghosh, P., Gupta, S., & Srivastava, M. B. (2019). The impact of FinTech and
digital finance on the banking industry. In S. Agarwal, & M. B. Srivastava (Eds.), FinTech and the
Transformation of the Financial Industry (pp. 1-20). Springer.
https://doi.org/10.1007/978-3-030-34079-9_1
• Boyle, M. (2024). Digital banking statistics 2024: How many Brits use online banking? [online] Finder
UK. Available at: https://www.finder.com/uk/banking/digital-banking-statistics.
• Carbó-Valverde, S., Cuadros-Solas, P. J., & Rodríguez-Fernández, F. (2020). The effect of banks'
IT investments on the digitalization of their customers. Global Policy, 11(S1), 9-17.
https://doi.org/10.1111/1758-5899.12750
• Chiu, I.H.-Y. ., Kokkinis, A. and Miglionico, A. (2021). Addressing the challenges of post-pandemic debt
management in the consumer and SME sectors: a proposal for the roles of UK financial regulators. Journal
of Banking Regulation. doi: https://doi.org/10.1057/s41261-021-00180-2 .
• David Donovan (2024). Why a Platform Business Model is Key to Digital Transformation | Publicis
Sapient. [online] www.publicissapient.com. Available at:
https://www.publicissapient.com/insights/why-a-platform-business-model-is-key-to-digital-transformation.
• Eickhoff, M., Muntermann, J., & Weinrich, T. (2017). What do FinTechs actually do? A taxonomy of
FinTech business models. In Proceedings of the 38th International Conference on Information
Systems (ICIS). Association for Information Systems.
https://aisel.aisnet.org/icis2017/IT-and-Future-of-Work/Presentations/2/
References

• Elsaid, H.M. (2021). A review of literature directions regarding the impact of fintech firms on the banking
industry. Qualitative Research in Financial Markets, ahead-of-print(ahead-of-print). doi:
https://doi.org/10.1108/qrfm-10-2020-0197 .
• Ganeshan, M.K. (2021). Impact of E-Commerce in Banking Sector. [online] Available at:
https://www.researchgate.net/publication/360783343_Impact_of_E-Commerce_in_Banking_Sector.
• Singh, J. (2019). Dheeraj Vaidya. [online] Wallstreetmojo.com. Available at:
https://www.wallstreetmojo.com/top-banks-in-united-kingdom/.
• Gomber, P., Kauffman, R. J., Parker, C., & Weber, B. W. (2018). On the FinTech revolution:
Interpreting the forces of innovation, disruption, and transformation in financial services. Journal
of Management Information Systems, 35(1), 220-265.
https://doi.org/10.1080/07421222.2018.1440766
• www.ibisworld.com. (2023). Banks in the UK - Market Size, Industry Analysis, Trends and Forecasts
(2023-2028)| IBISWorld. [online] Available at: https://www.ibisworld.com/united-kingdom/market-
research-reports/banks-industry/#IndustryStatisticsAndTrends.