Digital Banking, why Irish Banks lag behind global counterparts: Deloitte global benchmarking study

Eight areas identified where Irish banks can make improvements

Investment in improving user experience is key to success

Irish banks lag behind their global counterparts when it comes to digital maturity and digital services, according to Deloitte’s Digital Banking Maturity Study, the biggest global digital banking study undertaken to date.

Digital Banking Maturity 2020 is the fourth edition of the largest global benchmarking study of digital retail banking channels, exploring the steps leaders are taking to win in the digitalisation race. The study is based on customer input from nearly 5000 customers of 318 banks worldwide. It places banks across the globe into four categories in terms of digital banking maturity: digital champions, smart, adopters and latecomers.

While Ireland is still ranked as a digital latecomer similar to the 2018 study, Irish banks are moving closer to the adopter category. Banks in Turkey, Spain, Poland and Russia hold their positions as digital champions. Digital champions offer their customers a wide range of functionalities and a compelling user experience. They set key digital trends and have leading market practices, making them examples to learn from. Examples of champion banks are: BBVA, Yap? ve Kredi., Türkiye??Bankas?, Santander, Mbank and Millenium.

Commenting on the report, David Dalton, Partner and Financial Services Industry leader, Deloitte Ireland, said, “Market pressures from customers and competitors have created digital champions and it’s clear that the level of functionality and the user experience offered by banks are key to achieving digital champion status.  While Ireland’s banks do well on information gathering and sharing, day-to-day banking and expanding relationships beyond banking, they need to do more in the areas of personal finance management and investment services.

A customer-centred approach, recognising the importance of user experience as a key differentiator driving customer satisfaction, coupled with good design and function is critical to digital success. Simple, straightforward changes packaged together would help to improve the global ranking of Irish banks and, most importantly, provide better customer service and loyalty.”

Dalton concluded: “Looking to the future, banks like N26 and Revolut have shaken up markets elsewhere and they have a presence in Ireland; however, until they can offer a full suite of services, such as mortgages and pensions, they will remain in the challenger bank space.  If they were to make moves towards offering those services it would certainly shake up the traditional landscape of the five pillar banks here.”

“This study highlights an opportunity for Irish banks to make a big leap forward with their digital services,” said Deloitte Partner and Digital Financial Services leader, Yvonne Byrne. “The path is clear and the market is open for a bank to deliver great customer experience on the basic day-to-day banking services and start exploring bigger, bolder moves to disrupt the market here before competitors take the opportunity to lead the charge.”

The study has identified recommendations across eight areas which, if enacted, would improve the ranking of Irish banks, as well as improving customer satisfaction, brand image and sales.

1. Improve information gathering by explaining the processes, charges and offering live chat functionality.
2. Improve account opening by activating all channels not just championing one; allow “save and finish later” functionality.
3. Increase efficiency of onboarding by simply activating onboarding campaigns and facilitating bank transitions.
4. Improve day-to-day banking by offering family current accounts with easy opening functionality.
5. Expand beyond banking non-financial services and discounts in mobile banking to encourage customer activity.
6. Make personal finance management tools more valuable for clients by adding options to support budgeting and contextual offers.
7. Offer more life, non-life and brokerage services by making them easy to purchase digitally, accessible on mobile and by providing nudge alerts to aid customer decision-making.
8. Create and manage more channels such as Facebook and chatbots to improve customer support in an omnichannel way.