Banks need to challenge fintechs by playing the same game
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Banks need to challenge fintechs by playing the same game

Greenfield start-ups embedded within the core business might be the best way for banks to address their legacy infrastructure problem.


For many large banks, the greatest challenge they face is how to unshackle themselves from their legacy infrastructure and move forward using new, customer-centric technology.

In a new report titled ‘Time to start again’, consultants Oliver Wyman explain that the challenges from new non-bank trading businesses, digital neo-banks and the likes of Amazon and Apple mean that banks now need to look at how to combine new-build businesses with their existing business models.

The report suggests that the best method is to take a greenfield venture capital approach, setting up a separate organization – with investment provided in stages – that has the freedom to operate independently from the rest of the organization and deploy new technology.

Oliver Wyman has worked with RBS on just such a project: its digital bank Bó.

“Bó represents a new breed of financial institution – a greenfield digital bank owned by an existing incumbent,” Bó CEO Mark Bailie told the report’s authors.

“We knew the kind of outcome we wanted would be a long and hard journey for an incumbent bank to deliver, with product-centric legacy infrastructure. So, for us, the question was, how long have we got?

“If it is 10 years, you can probably transition the existing core into a truly customer-centric business, because you can do almost anything in 10 years if you are good and you can execute – and we still have a Plan A around this.”

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