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Regional Banks Reimagined

Infographic
  • Financial Services

As our most recent Consumer Banking Report demonstrated, the retail banking industry is undergoing a period of rapid evolution, with consumer preferences and sentiments changing quickly. In order to remain competitive, banks will need to understand these changes and plan accordingly.

Explore the infographic below to learn more.

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Regional Banks Reimagined

 

As we analyzed the U.S. market data in our latest Consumer Banking Report, we identified key themes that present unique opportunities and challenges for U.S. regional banks. We’ve highlighted the findings below.

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FINDING 1: A GENERATIONAL DIVIDE POSES A STRATEGIC CHALLENGE FOR U.S. REGIONAL BANKS.

The challenge:

U.S. retail banks must broaden and adapt their services to appeal to the next generation of customers. According to our research, 61% of customers of a typical regional U.S. bank are 55 years old and older. To sustain a growing customer base, regional banks must reimagine their acquisition and retention strategy.

The opportunity:

The key to capturing the next generation of banking customers is offering improved digital experiences. Almost half of U.S. respondents under 55 said that the pandemic made digital experiences more important to them and over half of them are ready to go digital if they were to switch to a bank in the future.

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FINDING 2: THE NEXT GENERATION IS LOOKING TO THEIR BANK FOR SUPPORT AND GUIDANCE AROUND THEIR FINANCIAL HEALTH.

The challenge:

Consumers – particularly those under 35 years old – are looking for real financial advice that goes beyond what can be offered on social media or from friends and family. In this year’s survey, 67% of respondents under 35 said they want more advice from their bank on how to best manage their money.

The opportunity:

There’s a real opportunity for retail banks to provide more personalized and assistive services. Proactive guidance anticipating “what’s around the corner” is what customers are seeking. Banks have the transaction data to do just that. Harnessing this data and predictive analytics, a bank can be the trusted advisor that customers are looking for. Developing these next-gen services is a great opportunity for those willing to rise to the challenge. 

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FINDING 3: CUSTOMERS DON’T WANT THE BRANCH TO DISAPPEAR. THEY WANT IT TO EVOLVE.

The challenge:

Generally speaking, branch traffic is declining, and we expect that trend to continue unless banks reimagine the branch experience. However, younger demographics still visit a branch, with a sizable 66% of the 18–34-year-olds we surveyed telling us that they had used their physical branch at least monthly in the past year.

The opportunity:

The focus for banks should not solely be on branch closures, but more the evolution of the branch to meet the changing needs of the modern consumer. In order to capture the next generation of customers, the branch needs to grow to become more of a financial experience center – a place where consumers can use interactive tools and receive personalized financial guidance and education.

The Time for Retail Banks to Act is Now

Navigating the technology, industry, competitive and customer landscape has never been more complex for retail banks. The next-gen customer is in control and demands banking that organically blends into their mobile-first lives, proactive and hyper-personalized financial guidance, and access to a physical branch for their more complex financial needs.

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THE CLOCK IS TICKING TO ACT A PRAGMATIC STRATEGY WITH AN EXECUTABLE ROADMAP IS A MUST TO NAVIGATE THIS NEW NORMAL. 

Want more of EPAM’s insights into the rapidly evolving financial services industry? Download the full report for more.

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