Mubasher: Digital banking is forecast to continue expanding in 2020, while ‘digital challengers’ are expected to reach additional spots at the expense of traditional high street banks, GlobalDat said, citing leading banking industry experts.
Several challenger banks currently form serious competitors to traditional banks, given the huge investment in the fintech industry in 2019, CTO Financial Services at Fujitsu, Ian Bradbury, told GlobalData.
“This will see them move even further into the mainstream in 2020,” Bradbury said, adding, “As a result, 2020 may be the year when a traditional bank takes the leap and acquires a challenger bank to take advantage of the brand loyalty, as well as the scalable cloud-native systems owned by those banks.”
Meanwhile, the CEO of Omnio, Adrian Cannon, remarked that in the time when retail bank branches have continued to close, Amazon, Apple, Uber Money and others figured out that they can reinforce their brand value and become an embedded and trusted partner by being hyper-relevant at multiple moments in their customer’s daily lives.
Cannon noted that “These [digital challengers] are set to increasingly extend their product set into the financial services sector, challenging the big banks to raise their game quickly.”
GlobalData’s banking editor Douglas Blakey, highlighted, “Digital-only challenger banks are on the rise. Six challengers are already worth more than $1 billion (Brazil’s Nubank $10.4 billion, US’ Chime $5.8 billion, Germany’s N26 $3.5 billion and UK duo Monzo and Revolut at $2.5 billion and $1.7 billion respectively.”