BrazilSynechron develops accelerator for digital banking ecosystems
As banking institutions increasingly work in ecosystems to foster collaboration and digital-led innovation, consulting firm Synechron has launched a set of Accelerators that help industry players prototype and speed up time-to-market of their innovative products, services and solutions.
Amid growing competition from tech-savvy bigtechs and fintechs that leverage their start-up cultures to out-agile incumbent players, as well as changing consumer behaviour, banks are in today’s environment being forced to achieve a competitive edge.
One strategy that is helping them in achieving this is an ecosystem strategy. Building on their scale and data, banks, asset managers, insurance companies and other incumbents can tap into partner networks to co-create value. “Such an ecosystem can help increase customer proximity, reduce operating costs and garner intelligence, all of which enables continuous engagement,” said Faisal Husain, CEO of Synechron.
Indeed, the promise of ecosystems has turned the approach into one of the industry’s key trends. According to one study by a research firm, in banking, nine out of ten institutions are to some extent interested in ecosystems, while another study from McKinsey & Company found that banks have now reached a tipping point in their views toward adopting ecosystems.
As ING’s global head of retail Ignacio Vilar put it on the bank's website, “We realise that we can’t do everything ourselves if we are to meet the needs of banking customers. Instead, we must connect with others. Much of today’s innovation is taking place as a result of partnerships between banks and fintechs.”
Within such an ecosystem, also referred to as ‘open banking’, banks can hold a number of roles, including a more passive role such as a third party ecosystem participant to an active role as a marketplace orchestrator. As part of the co-creation process, ecosystem participants typically work in an agile manner towards new products and services, often through so-called accelerators – programmes that in an integrated fashion ensure rapid prototyping and realisation.
Speaking of the benefits accelerators have provided ING, Vilar said; “Our use of accelerators that involve third parties is having a big impact. It’s an efficient way to develop new technology.”
Digital ecosystem accelerator for banks
Synechron has over the past two years developed several accelerators for the financial services industry, and has now extended its offering to include a set of digital ecosystem accelerators. Tim Coates, Head of Ecosystems at the firm said, “Banks stand to benefit from the acceleration of more open, API-driven, low-friction and interoperable platforms by increasing their monetisation of existing customers, building stronger customer profiles, and hence improving retention rates with more customised services.”
Specific accelerators have been developed for several segments within banking, including sustainable finance (focused on asset managers), digital home ownership (focused on services to home owners beyond a mortgage, such as insurance and utilities services) and treasury (focused on automation in treasury).
“The accelerators bring together multiple participants to co-create value and use cutting-edge, emerging technology solutions to offer a forward-looking approach that taps into a bank’s scale, data and partner network,” said Coates.
Putting its expertise to practice, Synechron recently helped Royal Bank of Canada (RBC) with the design and development of its Drive ecosystem. The platform supports car owners with all the financial and non-financial aspects of owning a car, from car valuations and documentation to guarantees of spare parts, insurance papers and a search service for maintenance. Drive adds significant value to car owners as it provides them with a one-stop-shop for all their dealings, in the process benefitting their commitment to Royal Bank of Canada.
