Banking sector changes in business models and the arrival of new players in the form of technology giants and start-up businesses are in full swing. This changes allows banks both vertical and horizontal changes in business strategies. Pressure by regulatory changes (PSD2, Consumer Protection, Data Protection, Alternative Funds Regulation, etc.) and changing business models is threatening unprepared banks. Regulatory pressure in the future will increase even further. Together with increased market pressure banks should already free their resources and cash flows for the journey to the digital business. Scattered distribution and price transparency, P2P platforms, crowd financing, new payment models, rails and ways of settlement, cheaper and smarter sensors, internet of things, “blockchain” and the emergence of API platforms and BaaS technologies are affecting the banking market. All represent an opportunity even for small banks at the global market, but it also raises new risks that the banking  environment may be difficult to accept.

The transformation of business models and adaption of business processes will require enormous consumption of resources, which are already limited. Banks resources are mainly focused into adjusting the branch network range and into segmentation of products and sales channels. Focus is also into ensuring compliance with regulation and into achieving cost-effective operations. Changes in customer behavior and expectations, new entrants and new technologies represent a  significant threat. Wealthier customers will be the first to adopt a new offering in the market. Are we reaching to them? Robo-advisors, price transparency and the possibility of integration of payment systems with digital giants may heavily impact bank margins. Are you ready to change?