Bank Innovation, a blog site produced by Royal Media Group, a media company that has served the financial services industry since 1995 released the results of its Q3 “State of Banking Innovation” survey. The survey polled industry watchers on which area of innovation their company is spending the most, what innovation looked like in banking today, and what it might look like five years from now.
“The innovation orientation at banks has ramped up significantly in the short time since the first quarter,” said JJ Hornblas of Bank Innovation.
Results showed that 64% of banks now have dedicated innovation teams focusing on online and mobile, a 720 basis points increase compared to the first quarter of 2013.
According to the data, the increase is an indication that new ideas seem to be in richer supply at banks today.
Moreover, the study also revealed that “corporate bureaucracy” is no longer the major impediment to innovation. 31.6% of respondents cited budget as the greatest impediment to innovation today, up from 17.6% in the first quarter.
Other findings include:
- 31.6% of respondents cited mobile banking technology as the area of innovation their company is spending the most money today; while 43.4% of respondents said mobile banking innovation was perceived as the “most valuable to consumers.”
- The percentage of respondents saying that they are spending the most on online banking innovation jumped 980 basis points to 23.7%
- Overall, spending appears to be on the rise for innovations related to mobile banking and online banking, while on decline for: Tablets; Payments; Channel Integration; Social Network Banking; Analytics; and Shopping/Rewards.
When asked to assess the overall State of Banking Innovation in the industry today, respondents gave different perception on innovation.
“The most common response was that innovation is slow but growing in the sector,” said Philip Ryan of Bank Innovation.
While when asked to describe what banking will be like in 2018, majority of respondents gave a positive response. They largely agreed that banking will be better for the customer in 2018: more convenient, more personal, less effort.
“Open banking, API’s will drive innovation, services together with partners, customer in control of his data,” said one of the respondents.