The small to mid-sized European banking sector has been experiencing a difficult phase recently, with declining profit margins driven by lower interest rates and an increase in credit losses. The COVID19 pandemic has further exacerbated the situation.
With revenue slowing down, the emphasis is now on cost efficiency, better risk management, and building a resource-light digital platform for servicing customers. This has, in turn, accelerated the need to scale up technology investments within the banks.
This White Paper shows how these banks are facing significant pressure from new competitors in the form of digital native challenger banks, FinTech startups and big tech companies. These competitors often have the advantage of a broader customer base and advanced technology to provide a hyper-personalised customer experience.
There is no doubt that modernising the technology infrastructure is the way forward for small and mid-sized banks. Temenos and IBS Intelligence take a deep dive into understanding the challenges, trends, and strategic implications for this sector, based on discussions with banks and subject matter experts within the European banking industry.