Asking if the bank of tomorrow has already appeared is more than a rhetorical question. This is due to the fact that in the last ten years a completely new phenomenon has taken place in the banking field: the appearance of financial players of international origin, whose development is not focused on a chosen market. In Europe, these include Klarna (split payments) or Raisin (savings and deposits), but also neobanks like N26 and especially Revolut. Because, today, Revolut is undoubtedly the actor that could most be recognized as “the” bank of tomorrow.
Traditionally, retail banking was based on a personal relationship of trust, which made the branch its main relay. Within the framework of any project based on savings or credit, the banker was an obligatory but separate interlocutor.
In a digital world, the banking relationship becomes daily assistance, backed by new tools for spending, budgeting, help choosing, saving. The bank is no longer represented by an agency but by a mobile application that adjusts to the uses of the consumer. These tools exist. The challenge today is to standardize them; find the formula that allows them to be useful to the greatest number, without incurring in colossal investments. This is a bet that Goldman Sachs failed with its Marcus retail banking test, but one that large US institutions are particularly trying to deliver, with success so far for Life planthe tool Personal Finance Management of Bank of America, or for Chase UK, a veritable “piggy bank” associated with expenses and JP Morgan Chase’s first notable foray into Europe.
Revolut, a great financial app
And then there’s Revolut. Hardly a bank (an almost non-existent offer in terms of credit and savings) but a great financial app. We have already had the opportunity, in these columns, to highlight the original approach of this neobank founded less than ten years ago in Lithuania and how it went to find its first clients in airports.
Revolut didn’t want to be just an online bank, which would have been trivial, and that’s probably the mistake many other new players have made, from Orange Bank to N26 today. From the beginning, Revolut aimed to support the rise of mobile devices as the primary purchasing and financial management tool. Only Paypal pursued the same objective but without sticking to the new modes of consumption of a chosen clientele, as Revolut was striving for.
Also, when Revolut today shows strong ambitions, we are quite tempted to follow them. Because Revolut – which intends to conquer Brazil, New Zealand and India very soon – no longer intends to be compared with other neobanks. It wants to become the first European bank and the main bank for the majority of its clients.
It does not matter that its 2022 turnover achieved in thirty countries seems almost ridiculous (850 million pounds). Never mind that getting a UK banking license seems to be unusually slow. Revolut opens over 1.5 million accounts a month! It is targeting 40 million customers by the end of the year and, in France, its second-biggest market in terms of growth, its app is the most downloaded after Crédit Agricole’s. Who says better?
New offers still exploded
Alone, on what levers does Revolut intend to support such ambitions? As recently announced, consumer credit and, eventually, mortgage credit. And that’s it? No, Revolut will also offer a joint account, ETF and an “Ultra” offer.
It seems almost unreal when all the segments of retail banking are now in the process of being recomposed: payment means and facilities, intelligent expense management, banking platform and invisible banking, savings support… Not to mention the new topics: bank of uses, economic well-being, end of overdrafts… So many new but still fragmented offers that only await assemblers to standardize them, a position for which Revolut’s international dimension would be decisive. But so many offerings and new dimensions that Revolut doesn’t seem particularly intent on exploring, stalling its ambitions on very rudimentary banking offerings that, for once, hardly compare to those of the most inventive neobanks (Starling, Monzo, Chime, SoFi, etc. , all of which have entered their domestic market.
For mobile to become the banking interface of choice on a large scale, it will likely take a generation. This is generally the time required for major banking innovations. So there are still 15 to 20 years left. And for the bank of tomorrow to appear, much remains to be done, which seems normal. But, obviously, there is also a lot left to imagine, which is much more problematic.
Source: BFM TV
