The dividends for banks prepared to embrace bold new strategies and operating models has never been higher. Consumers are looking for ever more flexible services that slot into their fast-moving lifestyles: today’s savers want to manage their money on-the-go via mobile, tablet or a few clicks of a mouse, rather than take time out to travel to their local branch.
In the mid-2010s, Equitable Bank recognised that these shifting sands presented an opportunity to launch something fresh and innovative. Over the past 50 years, the bank climbed the ranks to become the ninth-largest bank in Canada by focusing on mortgages, home equity lines of credit and term deposits, distributed through brokers.
Now, it saw the time was right to supplement this broker-driven approach and target a totally new market. Its goal was to launch ‘EQ Bank’, a fully digital banking arm offering high-interest personal savings products and an elegant, intuitive experience for the modern consumer, without delay.
In the first few weeks, savers had deposited over C$100 million
Spotting a Gap in the Market
The digital-only banking model was not completely unknown in Canada before EQ Bank, but a series of takeovers of the leading players in the 2010s left the door open for a savvy new operator. Equitable Bank saw the opening in the market and the rich potential for a digital service that delivered unique high yields for savers and made it a cinch to manage their accounts.
Dan Dickinson, Chief Information Officer at Equitable Bank, explains: “As a digital-only operator, we could avoid the costs and time delays of setting up a branch infrastructure, and we could pass those savings on to our customers in the form of highly competitive rates. We could also challenge old branch-based concepts – like the difference between chequing and savings accounts – that didn’t make sense to customers. As a bank, this model would also allow us to grow deposits much more quickly, and at lower costs, than the old branch-based transaction model.”
To transform EQ Bank from a great idea to a profit-driving brand, Equitable Bank began working on a new technology strategy. Rather than traditional legacy infrastructure designed to enable bank tellers to take deposits from savers, or a rigid technology stack that couldn’t grow and evolve with their business, Equitable Bank wanted a modern infrastructure that would allow customers to set up and access their money without support from its employees.
”Temenos has a strong presence in Canada, and clearly understands the unique challenges of the market here – something vendors often overlook. Also, we were highly impressed with how much Temenos invests in research and development, which gave us reliable access to the most advanced products.”Dan Dickinson, Chief Information Officer
Choosing the Best Product
Equitable Bank considered banking software from many of the leading vendors in North America, before identifying Temenos as the standout. To support the development and launch of EQ Bank, Equitable Bank selected Temenos Transact for robust, scalable back-end transaction processing, along with Temenos Infinity tools to help develop an intuitive, secure user interface.
Dan Dickinson explains: “Temenos has a strong presence in Canada, and clearly understands the unique challenges of the market here—something vendors often overlook. Also, we were highly impressed with how much Temenos invests in research and development, which gives us reliable access to the most advanced new products.
“The other key selling point was the flexibility of the Temenos platform: we could adopt some elements of the solutions, while not using others; most vendors offered a more rigid technology package. Talking to Temenos, it was clear they really understood what we were looking to achieve and could support us every step of the way.”
The Temenos solutions handled massive transaction volumes without a single blip
Meeting Tough Timelines
Equitable Bank wanted to move fast, aiming to launch EQ Bank in just 18 months. In response, Temenos provided a dedicated project team and delivered initial code within nine months. During the design stages, Equitable Bank took advantage of the Temenos user experience platform (UXP) to build online and mobile banking apps, and create a simple onboarding process that enables customers to open accounts in two to three minutes.
Dan Dickinson continues: “Temenos impressed us by pulling out all the stops to meet our timeline. The built-in Canadian Model Bank functionality helps us to meet many stringent compliance requirements, simplifying access to data and report generation.”
Since its launch in January 2016, EQ Bank has proved a huge success. In the first few weeks, savers had deposited over C$100 million—a figure the bank had not expected to reach for several months. In the face of extraordinary demand, the Temenos solutions handled massive transaction volumes without a single blip. Today, customer numbers stand at nearly 80,000 with more than C$2 billion in deposits with EQ Bank, making Equitable Bank one of the key digital players in Canada. In fact, the bank reached its five-year growth target in half the anticipated time.
The bank reached its five-year growth target in half the anticipated time
Harvesting the Fruits of Ongoing Partnership
More than a typical vendor-client relationship, Equitable Bank enjoys a real strategic partnership with Temenos. Dan Dickinson comments: “Every week, I speak to my counterpart at Temenos, as do our product teams and Vice President. Our Chief Executive Officer also has a monthly checkpoint with Temenos executives, and both teams gather quarterly for an in-person business review. During the conversations, we pick up industry insights, learn about new products and iron out any issues.”
Working with professional services and product teams at Temenos, Equitable Bank is currently upgrading its Temenos Transact and will soon move its infrastructure to the public cloud—making it one of the first Temenos cloud users in North America. Beyond this, the bank is planning for the era of Open Banking, and is confident that Temenos will support the journey.
Dan Dickinson adds: “This is an exciting time for us. Cloud offers the enhanced scalability and flexibility we need to pursue aggressive growth plans, while we can see real security benefits from modern public cloud infrastructure. Open Banking offers a real opportunity for us, too, and Temenos will be our first port of call when we kick off these initiatives.”
”We reach out to other banks in North America, Europe and beyond, and recommend Temenos. We don’t believe we could have built a new service in 18 months with any other vendor. We don’t use the term partnership lightly, but that’s exactly what we have with Temenos – our strategic alliance has helped us overtake and outlast the competition and strengthen our market position.”Dan Dickinson, Chief Information Officer
EQ Bank capitalizes on cutting-edge technology to offer seamless customer experience with transparent and value-added services