Retail Banking

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Transformations in Retail Banking

While continuing to maintain and control costs, retail bankers are focusing on achieving growth, updating core systems, improving sales and service for greater customer satisfaction and adopting sourcing strategies that will also help meet regulatory demands. 

Findings from the 2006 World Banking Report, reveal retail banks are in a highly competitive market where local banking prices declined slightly by 1.5% and the average price of basic banking services was €76 down from €78 the previous year. Fierce competition in the US and evolving retail banking markets (Eastern Europe, China) are prompting changes in pricing structures while in Europe prices continue to converge in the eurozone.

How will banks compete in this competitive market? 

Banks expect 1/3rd of their sales to come from remote channels by 2010. Remote channel sales are expected to increase dramatically in importance as banking services lose their human touch and branches focus more on proactive advisory sales.

 

Capgemini helps financial institutions face the highly competitive Retail Banking market with solutions in four areas:

Sales and Service Innovation

Transforming from a traditional product management business model, in which each product area makes its own independent sales and service decisions, to a relationship-based model, in which all customer interactions are handled holistically across the business. Download our document on sales and service innovation.

Branch Optimisation

Changing the customer experience with the traditional bricks-and-mortar branch environment to use this expensive distribution channel more efficiently and link it more closely with other bank operations. Download our document on branch optimisation.

Multichannel Management

Developing the tools and processes that help synchronise a bank’s diverse distribution channels in a way that optimally balances customer preferences and profitable economics. Download our document on multichannel management.

Back Office Scaling

Making more effective use of the existing asset base by assessing different options for the supply of products, including pooling resources into shared service centres and outsourcing noncore activities to specialists. Download our document on back office scaling.

The solution area where a bank chooses to concentrate its efforts depends on which of the three main competitive levers an institution’s strategy is founded: products, pricing, or customer service.

Each of the four solutions can impact one or more of the three levers. The impact that each solution achieves will vary, so significant efforts planned for any one of the solution areas must be conducted in the context of a bank’s overall strategy, and be coordinated closely with efforts in the other solution areas.