Are you ready for Banking 4.X?

Traditional retail banks must embrace digital transformation, engage in digital ecosystems and make financial services more accessible to banking customers. That is the main message in the World Retail Banking Report 2021 that Capgemini and Efma recently published. Digital transformation, customer experience, digital ecosystems? All of those are right up our alley at TrustBuilder.

The recently published World Retail Banking Report 2021 shares a lot of food for thought for anyone in financial services. The report includes insights from both banking customers (8,500) and senior banking executives (130) from 23 different regional markets. According to the report, the post-pandemic disruption has ignited a new era of value-based customer-centric banking, which the report dubs Banking 4.X’. To succeed in Banking 4.X, banks must embrace digital transformation and adopt cloud-based Banking-as-a-Service (BaaS) platform models, which utilize APIs to embed banking in everyday life, making it more accessible and inclusive for banking customers.

Traditional banks vs Neo-banks

Over the last ten years, neo- and challenger banks have enjoyed a great deal of success, attracting over 39 million customers worldwide. Customers mainly switch to a new-age financial provider, says the report, on account of their easy access and flexible banking. Traditional banks recognize the danger from these new entrants in the market. To retain and grow their customer base, they have embarked on digitization and cost optimization journeys. The report notes that nearly half (46%) of banking executives are unsure on how to embrace open banking, orchestrate ecosystems and become truly data-driven. Capgemini’s Group Executive Board Member Anirban Bose claims, “financial institutions will have to move beyond their core banking products, create new offerings and provide their customers with personalized experiences. Banks must focus on how they can add value to their customers to retain and engage them.”

Banks need to monetize ecosystems

The report advises banks to unlock new value in open ecosystems, which embed banking and other services within customer lifestyles. Offering these extra services affords fast access to new data sources and unlocks monetization opportunities. According to the report, incumbents have several strengths they can capitalize on, such as knowledge of the customer, transaction processing and connectivity to global schemes. And they can tap into an array of external providers to improve their offering and cater to consumer demand for more integrated and personalized experiences.

Retail banks accelerate their digital transformation in 2021

The World Retail Banking Report is a confirmation of what we are also seeing in the market: retail banks (and other financial services companies for that matter) have all accelerated their digital transformation journey. This happens in different stages, as TrustBuilder’s maturity model shows: while some banks focus on releasing digital products and services and improve on their customer experience, others are ahead of the curve and are connecting to third parties, setting up their own digital ecosystem and developing new business models.

Identity and Access Management is a key component of Banking 4.X

TrustBuilder’s Identity and Access Management (IAM) helps financial service companies in each step of their transformation journey. To offer customers a great user experience while also guaranteeing security, functionalities such as Single Sign-on, Federated Identity Management, Adaptive Security and Multi-factor Authentication are crucial. As customers prefer their mobile devices as the key to their banking activities, mobile multi-factor authentication gets rid of passwords.

When banks move up the TrustBuilder maturity model, APIs and API Security make it easier to connect to third-party applications and build digital ecosystems. To help retail banks bring new (third-party) applications to market, TrustBuilder developed a Service Catalog which offers seamless connections to a host of regional and local Identity Provides and services. As a European IAM vendor, we have close ties to many local as-a-Service companies (e.g. mobility providers) that can enrich the customer experience. On top of that, we can also share our experience in building marketplaces and monetizing new business models.

Are you ready for Banking 4.X? TrustBuilder certainly is.


Frank Hamerlinck

Frank Hamerlinck

As co-founder of global trade management leader Porthus, customer experience platform NGDATA, and strategic consulting services company innacco, Frank embodies the entrepreneurial mindset. His 20+ years of ICT experience is complemented by his position as ‘Entrepreneur in Residence’ at iMinds and coach at Netwerk Ondernemen.

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