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Delight, Don't Duplicate

How Swedish banks can use their strengths
to compete with digital disruption

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With customer loyalty decreasing and consumers expecting increasingly ingenious digital services, fintechs stand to gain a foothold in Swedish consumer banking, meaning incumbent financial institutions face eroding margins.

Banks have typically responded to the fintech threat by replicating digital functionality and technology innovation. But such duplication only serves as a survival tool. To thrive, traditional banks need to leverage their existing strengths to differentiate themselves.

Find out what factors influence your customers

Watch the video with real insights from qualitative interviews in Mall of
Scandinavia.

                                                               

CUSTOMERS AREN'T AFRAID TO SWITCH BANKS

Your customers aren’t as loyal as you think. While many have been with their bank for a long time, all they really want is a good deal, great service and a relationship they can trust. Today’s consumer continuously evaluates their banking services providers and isn’t afraid to switch to whoever helps them achieve their goals

76

 

said they have more than one bank

26

 

said they have more than three banks

51

 

said they have thought of switching banks within the last year

How can banks respond to fintech disruption and safeguard their long-term profitability? 

Our report shares expert analysis of consumer insights gathered from:                                                           

  • qualitative interviews of consumers in Sweden
  • focus groups with different demographic cohorts     
  • an online quantitative survey of Swedish consumers.

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HOW CAN SWEDISH BANKS RESPOND TO DIGITAL DISRUPTION?

Incumbent banks have four key strengths: their balance sheet, their large customer base, their trusted position, and their regulatory and compliance know-how. They can use these strengths to deliver value-adding services that delight customers, partnering with FinTechs to fill service gaps.


Deliver value-adds that delight customers

While digital is driving new customer behaviours and expectations, it’s dangerous to think shiny digital packaging around old products and services will be enough to keep customers satisfied. A good digital experience is no longer a unique selling point – 80 per cent of customers expect good digital tools. Fast online onboarding and simple apps and websites that give access to all services are all now hygiene factors.     

To show where banks should focus value-adding efforts, our report divides the features, services and products that banks can offer into four broad categories based on how they deliver against customer expectations.

Play to your strengths in the banking ecosystem 

Swedish consumers are more likely to trust one of the main banks over a new entrant, and they’re more likely to try a new fintech service if it’s connected to a bank they already know. Incumbents should leverage their brand and allow fintechs and other players to plug into their banking apps and other digital services. This way, banks can focus on value drivers and delighters, while still offering nice-to-have features. The more services that are integrated into one app, the more time consumers will spend on it.

To show how banks can become integrators, our report explores three successful integrator strategies based on a variety of traditional banks’ strengths and weaknesses.

Related insights

 

Contact us

Lan-Ling Fredell

Innovation and fintech expert

Steve Payne

Head of Financial Services, Sweden
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