Embracing a Banking Ecosystem to Transform and Innovate


In response to evolving consumer expectations and rising competitive pressures, the banking industry is undergoing multibillion-dollar digitization transformation. These initiatives are focused on fundamentally changing the entire banking technology stack, including reimagining the business with a customer-centric approach. With traditional banks increasingly relying on technology, financial technology (fintech) services adoption is also experiencing rapid growth. Fintechs raised $33.9 billion in venture capital in 2019 alone. In Europe, new entrants in the banking industry such as digital-first banks, non-bank payment institutions and big technology companies have captured one-third of all new revenue since 2005, jeopardizing the competitiveness of traditional banks.

Underlying this transformative change is a disaggregated value chain that cuts across businesses and industries, leading to increasing interdependencies on a model that relies on networks and the power of many. Through collaboration with external partners such as fintechs, advisors, third-party developers and other technology partners, banks are joining the value chains of different industries to create ecosystems. The goals include a reduced cost to serve, improved efficiency and reduced friction, thus providing customers with new experiences and stimulating their desire for more. If implemented correctly, a banking ecosystem is able to create a customer-centric, unified value proposition that expands beyond what customers could previously get.

Read the ISG paper Embracing a Banking Ecosystem to Transform and Innovate to learn more about the factors that impact the banking industry and how banks can leverage ecosystem partnerships to survive in this constantly changing competitive environment.

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About the authors

As ISG’s Lead Partner for Banking & Financial Services, Owen Wheatley has built a decorated career, serving major clients around the world, advising them on a broad range of market trends, emerging technologies and associated strategies. With responsibility for senior client relationships, business growth, go to market strategy and delivery excellence through the management of high-performance advisory teams across multiple regions, he sits on ISG Executive Committees in both the USA and Europe, and continues to be a widely published thought leader in the industry.

Sagnik is an Assistant Manager in ISG Research and has more than 9 years of experience in market and industry research across various emerging technologies. In ISG, he is responsible for authoring thought papers focused in the Banking & Financials, Travel & Transportation and Application Development & Maintenance space. He holds a degree in business administration from International School of Business & Media and an undergraduate degree in Economics from University of Delhi.

Aparna has 13 years of experience researching and writing on the impact of digital transformation across industries. Her work has involved conducting in-depth research and analysis focused on identifying future trends and developing differentiated frameworks for clients. Prior to joining ISG, Aparna developed a robust research practice for digital and strategic insights at Accenture.

Paul leads the ISG Provider Services group, which offers a variety of subscription-based research and project-based consulting services to the outsourcing service provider community. ISG Provider Services provides research and strategy guidance as well as helps service providers better target, win and retain clients.