Small, agile and fast growing tech-companies from the Silicon Valley are the new innovators in the financial industry. When did you see the last real innovation coming from one of the big old banks?
If you look at the European market, most banks are interacting with their customers via boring web portals or e-banking solutions with terrible user experience from the last century.
This is not a suprise if you know how internal business is running in huge banks. Most of them have very complex internal organizational structures, tons of processes, slow decision making and employees who are not used to innovate, change things or “do things out of the box”. But it’s not the people, it’s the organization itself which is not innovation friendly compared to the work environment in Fintech start-up companies.
Banks have to change their internal work culture and internal organization to attract the best smart creatives with a deep understanding of the financial industrie as well as technology.
But there is hope, some smart banks already started to re-invent themselves, they began to rebuild their organization, realized that only employees in modern work environments are able to push the bank forward with their innovations and deep understanding for customer service and the digital channel.
A really bad example is that many banks still believe that investments in retail bank branches are good investments.
According to a Goldman Sachs reports says that 33 percent of millenials say they won’t need a bank in 5 years, but this does not stop big banks to rollout futuristic branches to keep up with the technology cutting edge.
Brett King, founder of mobile banking app Moven, said the banking industry will experience more disruption in the next 10 years than in the previous 300 years.
This will hurt.
Read more: CNBC article “The cool bank branch of the future has zero chance”