PA business transformation expert, Olaf Valentin Kjær, is interviewed on national radio about the biggest challenge banks have faced in years: how customers increasingly prefer to use the internet and their mobile phones when dealing with a bank, and how major players such as Google, Amazon and Facebook will become major competitors to traditional banks.
Olaf says: “Technology has changed. We are all very close to our mobile phones but may live and work far away from our bank’s local branch. This means consumers will increasingly use their mobile devices to get access to financial services. We are also becoming less loyal and prefer shopping around between different service providers, technologies and solutions – one of which could be the new retail banks such as Tesco and Coop Bank.”
Olaf states that if banks fail to make major changes with regards to their business models, they will become irrelevant to customers: “Banks need to enter the digital world and change their business model. The underlying systems of the banks are out of date and extremely limited by cost. Today, banks need to handle millions of transactions every day, and customising this to the old systems is very expensive. Essentially, banks need to redefine their business model in order to survive.”