Bank revenue growth at risk from digital disruption

Accenture study finds digital-only banks, fintechs and big tech companies quietly gaining customers.

By Richard Schwartz

Research from Accenture shows new entrants to the banking market — including challenger banks, non-bank payments institutions and big tech companies — capturing up to one-third of new revenue, challenging the competitiveness of traditional banks.
Accenture analysed more than 20,000 banking and payments institutions across seven markets to quantify the level of change and disruption in the global banking industry. The studies – Beyond North Star Gazing discusses how industry change is shaping the strategic priorities for banks, Star Shifting: Rapid Evolution Required outlines what banks can do to take advantage of these changes – found that the number of banking and payments institutions decreased by nearly 20% between 2005 and 2017, but that nearly one in six current institutions entered the market after 2005. 

“Most banks are struggling to find the right mix of investments in traditional and digital capabilities as they balance meeting the needs of digital customers with maintaining legacy systems that protect customer data,” said Alan McIntyre, a senior managing director at Accenture and head of its global Banking practice. “Banks can’t simply digitally enable their business as usual and expect to be successful. So far, the conservative approach to digital investment has hindered banks’ ability to build new sources of growth, which is crucial to escaping the tightening squeeze of competition from digital attackers and deteriorating returns.