NatWest takes aim at digital adversaries, revamping its retail banking strategy
- NatWest is taking a human-focused approach to digitization and could leverage its resources to gain an edge over challengers.
- But the UK incumbent’s legacy technology could slow its roll.
- Insider Intelligence publishes hundreds of research reports, charts, and forecasts on the Banking industry. Learn more about becoming a client.
The UK incumbent is introducing a revamped retail banking model aimed at boosting revenues and reclaiming market share from neobanks, per the Financial Times.
The improved platform will utilize video to increase access to human bankers, offer new low-risk investment products for mass market savers, and expand NatWest’s credit solutions. The bank is hoping to get the best of both worlds by gradually improving its digital app alongside taking a human-centric approach to banking.
NatWest could improve customer satisfaction and gain an edge over neobanks by digitizing incrementally and tapping into its existing advantages.
- Customers want digital evolution, not revolution. Digital challengers enable users to conduct their banking activities right from the palm of their hand, but many remain frustrated with the lack of personal interaction they provide. NatWest’s forthcoming video capability will allow customers to directly access a human banker at their convenience—even well into the evening. Digital counterparts like Revolut and Monzo trail incumbents in offering customer service capabilities, and NatWest’s new video feature could widen this gap. The bank’s hybrid approach could empower users digitally, while also maintaining the human support they value.
- NatWest is a widely recognizable brand. UK adults generally consider the brand of a financial institution to be an important attribute when choosing a bank—giving 53-year-old NatWest an advantage over digital upstarts on name recognition alone. What’s more, consumer trust in banks rose in response to the pandemic, and a better digital experience will attract customers who have transitioned more of their banking functions online over the past year. A better-established institution could help assuage hesitations customers may have over security or privacy.
Despite its digital ambitions, NatWest could still face roadblocks that might impede its ability to compete against digital challengers. UK incumbents still rely heavily on outdated infrastructure to complete a large portion of functions, and they could lack the technical capabilities necessary to produce and maintain competitive digital products and services.
It is unclear whether NatWest’s updated platform will be powered by legacy technology, but regardless, maintenance costs could limit its ability to roll out innovative digital solutions. The bank has also recently suffered several high-profile setbacks as it tries to compete in the digital space: It closed Bó, its consumer-focused standalone digital bank, last May after only six months, and shuttered Esme Loans, its digital lender, earlier this month.
Because its digital upstart competitors don’t have to shoulder a similar technical debt that could hinder their ability to innovate, NatWest’s digital revamp could struggle to compete with these newcomers.
Want to read more stories like this one? Here’s how you can gain access:
- Join other Insider Intelligence clients who receive Banking forecasts, briefings, charts, and research reports to their inboxes each day. >> Become a Client
- Explore related topics more in depth. >> Browse Our Coverage
Current subscribers can access the entire Insider Intelligence content archive here.
Source: Read Full Article