Skip to main content

How Fintech Innovation Transforms the Banking Sector

Trusted banking relationships are important to both customers and financial services organizations. Traditionally, a banking relationship was a longstanding one, that could potentially last a customer’s lifetime. Today, that now seems like a bygone era.

The introduction of online and mobile banking solutions has fundamentally altered the traditional relationships in the banking area, enabling disruption to the legacy financial services business model.

Measures to increase competition and make switching accounts easier have reduced friction, while strong commoditization of services in the U.S. market has led to decreases in profit margins.

Digital Banking Market Development

The total number of digital banking users will exceed 3.6 billion by 2024 -- that's up from 2.4 billion in 2020 and a 54 percent increase, according to the latest worldwide market study by Juniper Research.

This growth will be driven by the rise of digital-only banks, fintech innovations, and the ongoing focus on digital transformation by established consumer and commercial bank brands.

The new research study found that digital-only banks have gained market share from traditional banks by offering superior user experiences and tightly focused unique selling propositions (USPs).


The research recommends that established banks must personalize the software app experience; using artificial intelligence (AI) based personal financial management tools to effectively compete against digital-only bank innovation.

Financial services firms invested heavily in digital transformation and new product offerings in 2019, although the extent of these market development activities varied considerably.

Juniper's 'Digital Transformation in Banking Readiness Index' analyzed leading Tier-1 banks to evaluate their digital transformation readiness and highlight their respective positioning in their digital innovation roadmaps.

Juniper analysts identified the top three leading group of banks for digital transformation, as follows: Bank of America, BBVA and JPMorgan Chase.

Bank of America offers extensive digital solutions, including the Erica chatbot, and has had noticeable adoption in digital usage and engagement.

BBVA has focused on capitalizing on APIs in banking, by offering the BBVA Open Platform, which is a Banking-as-a-Service platform.

JPMorgan Chase has experimented with blockchain technology and is rumored to be planning a digital-only service launch in the UK.

Outlook for Digital Banking Innovation Growth

"These banks have executed highly effective digital transitions; however digital transformation is never complete. These banks must now refocus on the new strategies required to retain their digital leadership," said Nick Maynard, lead analyst at Juniper Research.

The research also noted that traditional banks are launching digital-only brands, such as Bó from UK bank NatWest. However, Juniper analyst has cautioned that these product launches must be differentiated from existing offerings and digital-only competition -- providing a more personalized experience -- or they will fail to gain momentum.

Popular posts from this blog

How to Drive Value Creation from Digital Business

Across the globe, many forward-thinking CEOs and CFOs continue to fund business technology investments that enable meaningful and substantive digital transformations, ahead of their industry peer group. That's why CIOs and other IT leaders must now accelerate the quest for value creation and drive digital growth from those ongoing investments, according to the latest market study by Gartner. "The pressure on CIOs to deliver digital dividends is higher than ever," said Daniel Sanchez-Reina, VP Analyst at Gartner . "CEOs and boards anticipated that investments in digital assets, channels, and digital business capabilities would accelerate growth beyond what was previously possible." Digital Business Market Development   CIOs expect IT budgets to increase 5.1 percent on average in 2023 -- that's lower than the projected 6.5 percent global economy inflation rate. A Gartner survey analysis revealed several ways in which CIOs can deliver "digital dividends&qu

Digital Transformation Investment at $3.4 Trillion

Business technology leadership matters. Across the globe, more leaders have been pursuing bold Digital Transformation (DX) initiatives with the goal of creating new sources of business value through digital products, services, and experiences. As an additional benefit, the COVID-19 pandemic revealed that digital transformation efforts improve an organization's resilience against global market disruptions. Global DX investment is forecast to reach $3.4 trillion in 2026 with a five-year compound annual growth rate (CAGR) of 16.3 percent, according to the latest worldwide market study by International Data Corporation (IDC). Digital Transformation Market Development "Despite strong headwinds from global supply chain constraints, soaring inflation, political uncertainty, and an impending recession, investment in digital transformation is expected to remain robust," said Craig Simpson, senior research manager at IDC . The benefits of investing in DX technology -- including aut

Artificial Intelligence for National Border Security

National border protection agencies are under pressure to provide the highest level of security in the face of growing threats, such as increasing illegal migration and international terrorism. Now, government agencies are embracing advanced border security technologies to aid in effectively and reliably securing national borders. These solutions look to detect and identify potential threats and prevent them from escalating to a point that may jeopardize security. Security Surveillance Market Development Traditional border security patrols and Closed-circuit Television (CCTV) surveillance systems aren't adequate protection, and agencies must increasingly deploy new solutions to stay ahead of criminals and other potential threats to ensure the safety of a country’s borders. According to the latest market study by Juniper Research, the value of the border security technology market will exceed $70 billion globally in 2027 -- that's rising from $48 billion in 2022. Growing by 47 p