“New Revenue Models for Banks” - The top 5 responses to challenger banks – and how not to respond
During the last decade, the banking landscape has become increasingly competitive. Digital challenger banks have successfully entered the fight for owning the customer relationship in banking and demonstrated impressive growth rates in many markets. A shift in consumer behavior and the rise of digitization has enabled non-traditional players to position themselves successfully in the financial services sector. Fully digital direct banks like Monzo or N26 outpace incumbents in customer acquisition. Focusing on the evolving needs and expectations of today’s consumers, their growth is driven by an innovative product design, convenience and simplicity. Challenger banks are especially successful among Millennials, a trend that is likely to continue with the rise of Generation Z. Maintaining the status quo will increase the risk of losing relevance for incumbents – an outcome that banks can avoid if they act now.
Demirok, P. / Dr. Kipker, I.
Published in: White Paper, 2020