Retail banking is transforming towards digital and customer-centric...

Capgemini’s Global Retail Banking Report (WRBR) 2025 has highlighted the significant changes that have taken place in retail banking over the past decade. Banks have been embracing digital innovation to deliver seamless, personalized customer experiences that meet their unique needs at an unprecedented scale.

Driven by mobile banking, artificial intelligence (AI), advanced data analytics and cross-industry collaboration, this transformation has redefined how banking services are delivered. As a result, customers enjoy greater convenience, faster transactions, better financial management and personalized experiences, services and offers – far beyond what is typically associated with a traditional bank.

This shift also marks a significant evolution where customer-centricity, technology-led innovation and integrated payments have become essential for success. To remain competitive and relevant, banks need to continue to innovate to meet the rising expectations of modern consumers in an increasingly digital-first world .

Digital transformation is redefining the customer experience

The financial services sector has evolved from product-centric to customer-centric, marking a fundamental shift in the way banks approach customers. Traditional, fragmented customer experience processes have given way to seamless, end-to-end digital experiences. Today, customers demand intuitive, efficient, personalized services – and it is these customer expectations and behaviors that are driving the transformation.

Capgemini’s Global Retail Banking 2024 report revealed a significant shift in customer behavior, with only 16% of interactions taking place in bank branches. Meanwhile, 61% of customers manage most of their transactions digitally, with very few going to physical locations. The shift to digital-first – and sometimes “digital-only” – banking is in full swing. Technology-driven solutions (like chatbots) are revolutionizing the customer experience, with 53% of customers using chatbots for essential banking services like instant account updates and personalized financial advice based on spending habits and lifestyle choices. Additionally, the need for voice recognition for authentication is growing, as customers look for faster and more secure interactions.

The shift to a digital-first experience allows customers to access hyper-personalized offers and services, streamlined interactions, and new payment solutions. For banks, meeting these rising expectations requires more than just digitizing existing processes; it requires a comprehensive transformation that puts the customer at the center to ensure decisions are aligned with each customer’s individual needs and preferences.

New generation players are creating engaging customer experiences

“The goal of both traditional and new-generation banks is to meet customer needs. The difference lies in how they do it – by providing an effective user experience, remaining relevant in a digital context and addressing specific needs in a timely manner,” said Natascia Noveri, CEO of Retail Banking and Wealth Management at Intesa Sanpaolo (Italy).

In an era where convenience, personalization, and seamless digital experiences shape customer expectations, next-generation financial innovations are redefining the banking industry.

Unbound by legacy systems, these players are transforming the concept of customer-centricity by offering customized solutions that appeal to the modern, experience-driven consumer – a new world of banking where you can open an account on a Sunday afternoon and immediately make your first transaction via a digital wallet.

Companies like Nubank (operating in Brazil, Mexico and Colombia) and Revolut (operating in the UK, Europe, Australia, New Zealand, Japan, Singapore, the US and Brazil) have quickly become influential forces in the global financial ecosystem by providing accessible, flexible and attractive services that meet changing customer needs.

Revolut has become a key player in customer-centric financial services, combining innovation with accessibility. Revolut’s plans offer a range of value-added benefits such as access to stocks, gold and crypto trading, eSIM data, partner registration and insurance, and convenient, instantly activated virtual cards.

Frequent travelers are delighted with tailored offers such as multi-currency cards, no foreign exchange fees and free ATM withdrawals. Revolut is also expanding its services with local IBANs, competitive deposit rates and loans, gradually positioning itself as a mainstream bank and a strong alternative for younger customers (18-45).

With Revolut, opening an account takes just seconds and offers everything from an online application process to 24/7 support, all available through an interactive mobile app. Tools like parental controls and financial goal setting help foster long-term engagement, especially for younger users. Revolut also enhances the personal banking experience with personalized analytics, real-time insights, automated transaction categorization, and tailored forecasting.

Security is a key pillar of Revolut's approach, with features such as personalised passwords, instant card freezes and advanced fraud detection. In 2023 alone, Revolut's security measures helped customers avoid around £475 million in losses from potentially fraudulent transactions.

This superior customer experience has driven significant growth, with 70% of new retail customers in 2023 joining through referrals. With over 50 million customers in over 35 markets and 10 million new users added by 2024, Revolut is gaining strong traction in the global financial services market.

Nubank: Brazilian Digital Bank Nubank is one of the largest banks in Latin America, serving over 10 million customers in Brazil and another 10 million in Mexico and Colombia. Nubank has redefined banking with its branchless, customer-centric model. Nubank’s intuitive app, transparent features, and seamless onboarding process have set a new standard, achieving an NPS (Net Promoter Score) of 69 – far ahead of traditional banks like Banco Bradesco (43) and Banco do Brasil (50) (GlobalData Banking Analytics 2025). Nubank has grown rapidly through customer referrals and expanded services like personal loans and insurance. As it continues to expand into Mexico and Colombia, Nubank is differentiating itself through its commitment to simplifying and innovating in the financial sector.

One Finance: Backed by Walmart, One Finance offers a financial platform with no fees and no minimum balance requirements. The platform offers attractive incentives, including up to 5% cashback at selected brands and a savings interest rate of 3.75% APY. Unique features such as flexible borrowing options for Walmart purchases and international money transfer services to over 140 countries help One Finance stand out. Committed to providing affordable and convenient financial services, One Finance brings maximum convenience to its users.

New payment methods will dominate in the future

As digital ecosystems mature, the payments landscape is undergoing a significant transformation, driven by the rise of contactless and remote payment methods. Instant payments and e-wallets are leading this transformation, dramatically changing the transaction process. Real-time payment systems are becoming the norm, allowing for instant account-to-account (A2A) transfers, while e-wallets provide a secure and seamless way to pay.

Instant payments are growing globally, but at different stages across regions. In North America, adoption is still nascent, with systems like the US’s FedNow in early stages, expected to be in place by 2025. Brazil is undergoing a rapid transformation with Pix, promoting financial inclusion and simplifying transactions. However, the Asia- Pacific (APAC) region is leading the way in instant payments adoption, with Hong Kong’s Fast Payment System (FPS), Singapore’s PayNow, Australia’s NPP and India’s UPI all driving rapid financial inclusion.

Capgemini’s Global Payments Report (WPR) 2025 shows that the share of instant or A2A payments in total transactions is expected to increase from 16% in 2023 to 22% in 2028. Meanwhile, e-money solutions, including e-wallets, are expected to increase from 5% to 8% over the same period. This growth comes at the expense of card transactions, which are forecast to fall from 57% in 2023 to 50% in 2028.

According to the WPR 2025 survey, the rise of A2A systems could lead to significant displacement of card payment methods, with 15-25% of card transaction growth expected to go A2A. Debit and prepaid cards are most at risk, with 77% of banking executives predicting major disruption, while 23% forecast major challenges for credit cards.

With the rise of instant payments, e-wallets are also rapidly gaining market share, enhancing rewards and loyalty programs through mobile applications. As a result, e-wallets are quickly becoming a solution for everyday transactions and playing a decisive role in the transition away from card payments. With these changes, banks may face the risk of losing important revenue sources such as card transaction fees, annual fees and interest, etc.

Banks struggle to attract and satisfy card users

A Capgemini survey of banking customers found that 73% of credit card users are primarily attracted by exclusive experiences, rewards programs and cashback offers. Some 72% of respondents said they use credit cards to finance large purchases, while debit cards have established a niche, with 97% of customers using them to withdraw cash and 62% using them to control spending and maintain a budget.

Banks deliver personalized experiences with credit cards and trusted financial solutions with debit cards, thereby improving customer satisfaction and maximizing profits from transactions, financing and card fees. With high daily usage, putting customers first will be key to driving growth in this segment. However, banks are facing challenges in attracting, reaching and converting new customers, despite having access to huge amounts of data from various sources. With this wealth of information, banks can better personalize offers, optimize outreach strategies and increase conversion rates.

However, banks still struggle to turn data into action, with conversion rates being very low. A survey of bank marketing teams found that only 9 out of 100 leads actually become customers. Key challenges include: intense competition from other card providers (83%), poor marketing messages and value propositions (72%), lack of customer insight (66%), complex sign-up processes (34%), and poor lead nurturing (24%).

Even after attracting customers, banks struggle to maintain their engagement. A serious shortcoming is that the current card experience often fails to meet customers’ rising expectations, leading to low satisfaction.

A Capgemini survey found that only 26% of customers were satisfied with their cards, 50% were indifferent, and 24% were completely dissatisfied. With 74% of customers at risk of churning, a key question arises: How can banks close the conversion gap while also delivering a superior experience that fosters long-term loyalty?

The opportunity for transformation lies in adopting a more customer-centric approach. Banks need to move beyond simply collecting customer information and truly understand their needs and deliver real value at every stage of the customer journey.

Source: https://baodaknong.vn/retail-banks-change-the-direction-of-digital-technology-and-lay-customers-to-be-centered-247437.html