Expecting the unexpected pays off for KBC
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Expecting the unexpected pays off for KBC

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The coronavirus pandemic is accelerating the switch to digital banking and digital banks, argues KBC’s Johan Thijs, but much of the upheaval was predicted to happen.


On March 17, Belgium went into a full legal lockdown. For Johan Thijs, CEO of KBC, this was a moment – although unexpected – for which the bank had long been prepared. As the pandemic unfolded in Italy, and Belgians returned from half-term skiing holidays, it was not difficult to anticipate what was likely to happen next.

Overnight, 15,800 out of the bank’s 16,200 employees began working from home. Only 5% remained in the office – mostly those responsible for the bank’s IT operations – along with Thijs himself, at the helm for whatever was going to happen. However, “from day one, we were up and running,” he says. “And never one for single second did the system fail.”

In the first weeks of the lockdown, the bank worked at an intensity rivalled only by the global financial crisis to consolidate its own operations and to assist customers and clients coping with the pandemic. “Busy would be an understatement,” says Thijs drily. 

In the early days of the lockdown, fear and uncertainty sent consumers to the ATMs to withdraw more cash than usual, and businesses to draw their credit lines, while some companies requested payment holidays for their loans. Mindful of the increase in cyberattacks and phishing emails to clients immediately after the banking crisis, KBC had already stepped up its cybersecurity, which proved prescient, as it experienced a number of attacks from those seeking to exploit the chaos. 

Quite which catalyst would be responsible for the next banking crisis was unknowable. And despite substantial risk planning by the business, Thijs notes that KBC’s operational risk was low. Its remote working capabilities had already been stress-tested by chance; for the past few years, Belgium’s rail network has been disrupted a few times by a series of strikes, keeping almost 10,000 of the bank’s staff from travelling. While no-one could have predicted the coronavirus pandemic, the railways provided a suitable rehearsal. 

There was one crucial difference, Thijs points out: “That happened in an environment where our customers were still walking around.” 

The question for KBC was how the bank could best maintain its relationship with customers who could not move freely. For some older customers, or any who still wanted to speak to an adviser in person, accessibility was key. So the bank did not close its branches down completely, instead asking customers to make specific appointments to see an adviser within strict social distancing and safety criteria. For younger customers, digital solutions were the clear and evident answer.

“In four weeks, our securities platform had 50% more customers, a greater increase than for the whole of 2019”

Under Thijs, KBC has invested heavily in its digital solutions over the past five years, with major drives throughout 2017 to 2019. One of its most successful innovations is its mobile electronic banking app, KBC Mobile, which is now being used by 1.3 million customers and has won several awards as best banking app in Belgium and other CE countries. It offers a wide variety of financial services and popular non-financial third-party solutions, some of which are even open to non-KBC customers.  

As the pandemic began to hit Belgium, interest in the bank’s digital platforms rose sharply. “In four weeks, our securities platform had 50% more customers, a greater increase than for the whole of 2019, even though that was a record year,” Thijs says. “Our smart adviser application for tracker investments has also been very popular since its launch end of January.”

Fears that coins and banknotes could transmit Covid-19 have also helped to accelerate the move towards cardless payments. Belgium has seen a sharp decline in the use of cash, with contactless payments increasing by 25% to 30% over the five weeks immediately after the lockdown. 

Ahead of the curve

It is the customer driving this change, Thijs argues, inspired by their easy and intuitive experiences using smartphones and platforms such as Google and Amazon, where switching to digital channels for shopping and other economic activities pre-dates the pandemic. Unsurprisingly, those that spotted the trend and acted on it before the crisis struck are the ones currently coping best.

The pandemic could be with us for a long time, yet even when it is over, Thijs believes, customers won’t return to ways of banking that, for many, didn’t work for them. “We were changing before, but the pandemic has accelerated that change,” he says. “What coronavirus did in four weeks would usually have taken four years.” 

Covid-19 may have given the world a push, but the pressure to change has been building for years – if you were paying attention.

To find out more visit www.kbc.be/corporate/en/

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