SunTec

  Age old, static pricing strategies no longer work in the modern banking context. Customers are not interested in vanilla services and expect their banks to offer personalized, relevant, and on demand services and products. At the same time, there is increased competition from Fintechs and tech majors. Pricing based on classical methods like cost plus, segment based, or competition based are too risky in the new digital environment. And as seen during the 2008 financial crisis, net interest margins can contract quickly, impacting profitability. Mature banking products make it difficult for banks to pursue volume-based revenue models, and products like credit cards, mortgages, brokerage and checking accounts are turning into commodities. Banking in the complex new digital era calls for dynamic and  relationship-based pricing  models, and now is the time for banks to reimagine their strategies for better profitability and  customer retention . The Emergence of Value B...

  In today’s world, this can be taken even further. Banks are dead the moment they want to play it safe. The need to innovate is ultimate in the digital world where customer needs and requirements are highly contextual. The traditional banking products have become commoditized and all financial service providers have them in their portfolio. The only way to differentiate yourself and stay ahead of the curve is by innovating constantly – both from a product and a service perspective Agility has become a much overused term these days – however, clichés are so for a reason. Agility in general and competitive agility in particular is essential for banks to survive. But how can a bank remain agile with legacy systems worth decades while the smaller, newer fintech firms have flexible technology to bring any change necessary within days. Before getting into the ‘how’, let’s discuss the ‘why’ for a bit. Most corporate banks are of the opinion that since their customers are corporations, th...

  Convergence of industries brings a tectonic shift When one of the major industrial convergence started its genesis, Google was not yet born. The postal industry and the information technology industry started to converge with Hotmail in 1995. This led to a tremendous shift in the way we communicate. Fast forward to 2017, and I do not remember the last time I snail mailed a letter or sent an MMS. The key point to note is the tectonic shift such a convergence brought out. There is a definition of convergence from Merriam which stands out – the merging of distinct technologies, industries or devices into a unified whole. To this, it is important to mention that when the “unified whole” is achieved, there will be a similar tectonic shift which causes an exponential technological progress. This convergence will go on for the foreseeable future till the point of singularity is reached. When singularity is reached (which itself gives another perspective on convergence), we will witness...