Search results
Commercial banking 2025: Finding a new compass to navigate the future. Contents. Key messages. Helping commercial customers navigate clouds of uncertainty. Lever 1: Empowered relationship managers to drive higher trust. Lever 2: Digital experience has become table stakes to maintain relevance.
- Signals of change
- 2 Demand for banking services embedded within corporate processes
- Data, digital and technology
- Sustainable growth in SME segment
- 2 AI and machine learning (ML) is being deployed across a range of banking activities
- 3 There is an urgent need to improve speed to market
- 5 Creating value through data will differentiate performance
- Holistic, connected financial performance indicators
- Transformation requires a digitally 6 capable workforce
- 1 Commercial banks’ ESG response balances revenue stability, client loyalty and risk
- Future business models defined
- Reimagined digital commercial bank
- Platform provider
- Imperatives when transforming your business
- successful connected enterprise
- High maturity organizations continue to outpace their less mature peers
- Connected capabilities can enable a winning operating model
- Experience-centricity by design
- Seamless interactions and commerce
- Responsive operations and supply chain
- Aligned and empowered workforce
- Digitally- enabled technology architecture
- Integrated partner and alliance ecosystem
- Evaluating your capability maturity
- Products and services
- Insight-driven strategies and actions
- Innovative products and services
- Experience centricity by design
- Seamless interactions and commerce
- Responsive operations and supply chain
- Aligned and empowered workforce
- Digitally-enabled technology architecture
- Integrated partner and alliance ecosystem
- Global
- Europe
- Francisco Uría
- Geoff Rush
- Paul Greenan
- Celeste Diana
- Anton Ruddenklau
- home.kpmg/socialmedia
Commercial banking faces a more complex environment than perhaps ever before: client demands and rapid enhancement in digital capabilities, digitization and new sources of competition are forcing banks to urgently innovate.
Our survey indicates that integrating banks’ and clients’ systems can improve relationship value by 50 percent, an approach that is likely to supersede corporate portals, with commerce solutions integrated into accounting packages, this replaces costly and time-consuming manual tasks and improves data quality.5 Additionally, commercial banks have a...
Connected, AI supported technologies can drive decision-making and prepare banks for cloud and API-enabled ecosystems. Both financial and non-financial players can thrive in new ecosystems open to integration, greater connectivity and data sharing. Technologies such as distributed ledgers and quantum computing will increase transaction efficiency a...
SMEs play a major role in all global economies, and even more so in developing markets.9 Yet they remain an underserved segment, falling into a gap between large corporates and retail clients leaving potential revenue for commercial banks unexploited and creating an opportunity for sustainable growth.
These exciting technologies can help sales and marketing teams identify prospects and predict customer needs and propensity to buy. They also enable dynamic deal pricing for micro segments, as well as automating decision-making processes, credit rule sets and exceptions. By adopting AI and ML, banks can accelerate the maturity of treasury functions...
Consequently, we are seeing disintermediation by disruptors who are innovating through, for example, automated document population, e-verification, verifiable external data validation to simplify servicing assessments, financial spreading and deal structuring, which means the time to make a credit decision is rapidly reduced.
Niche solutions can be incorporated into a data ecosystem where competitors can be collaborators. Leading commercial banks are changing their role to become both producers and consumers of data, for example, selling payments, trade finance and lending capabilities to other organizations. The huge volumes of data generated should help commercial ban...
In mature markets, well-capitalized new entrants will likely compete for deals, impacting capital returns. Incumbent banks should expect to pivot to a holistic way of measuring financial performance, to obtain insights that can allow for meaningful change, thereby helping to increase capital effectiveness.
A digital business model, which harnesses advanced data and analytics and digital channels to offer self-service, should have significantly lower costs and better customer service. Person-to-person relationships are expected to continue with relationship managers (RMs) being deployed in a more targeted manner: to profitable clients; in situations w...
Faced with growing customer and shareholder activism alongside ESG reporting demands, commercial banking may be an enabler, helping clients achieve net zero by moving away from carbon-intensive projects. Commercial banks should clarify the role they want to play within their sector and the community: leader and ’trusted transitioner’ or a ’fast-fol...
By understanding the new commercial banking ecosystems, organizations can explore likely future business models. We see banks becoming platforms, providing an evolving mix of business products and services, and integrating vertically and horizontally across the value chain. These models are agile, scalable and will be open to other service provider...
These banks will transform into fully connected digital banks, leveraging capital and data while commercializing traditional cost centers through the re-bundling of services. They will offer a full range of hybrid value propositions and banking services to generate new income streams. They will focus on intricate and substantial private equity fina...
The platform provider develops infrastructure to enable the commercial banking ecosystem by providing, maintaining or policing a banking platform or ecosystem with either open or closed access, for its own and others’ purposes. The platform is a gateway to any number of services and clients and the technological infrastructure is a key source of in...
As they transition towards a connected enterprise, commercial banks should consider the following five imperatives: Innovate relationship models: Historically, success has relied on relationship managers (RMs) to acquire, nurture and retain client relationships while selling a broad range of the bank’s products and services. Relationship management...
Approaching change means adapting to a connected operating model.
Compared with their less mature peers, high maturity commercial banks that are investing in the eight capabilities are between 1.2 and 2.3 times more likely than their peers to successfully: Develop compelling customer value propositions on price, products, and services to engage the most attractive customers and to drive profitable growth. Harness...
The future commercial bank business models dictate the relative value and priority of each of the connected capabilities. The eight capabilities are enterprise-wide and can align the operating model to deliver value to the business and its clients.
Transform existing products and services by applying ’digital by default’, straight-through processing and ’right first time’ guiding principles. This should enable full-service banks to deliver products and services to their large customer bases that resemble the experiences newer market entrants are offering. Deliver an unparalleled consistent, s...
Digitization and automation of non-value-add activities will mean that every customer interaction is simple, engaging, transparent and adding value. Seamless interactions are defined by how well products are integrated with upstream and downstream players in the value chain to provide an experience that is fluid, even where there are hidden hand-o...
Leverage partners and third parties to drive efficiency through digitization and automation. Integrate with and leverage external data sources to expedite decisioning and onboarding processes simplifying the end-to-end journey. BaaS operations will be highly automated and integrated with upstream and downstream parties to run a zero-human back offi...
There should be greater in-house competency for driving large-scale technology change, with agile ways of working, including refreshed governance structures and decision-making rights being commonplace. Administrative tasks will reduce and relationship management coverage models will be tailored to value-adding activities and service excellence. Th...
BaaS operators will leverage API-centric value propositions to ensure scalability and an ability to easily integrate with upstream and downstream parties in a value chain, while ensuring data security and privacy. Leverage cloud-based technology to drive agility and open innovation, underpinned by a highly adaptable, modular and easily integrated t...
Digitization and automation of client-facing interfaces and interactions should be supported by the right data flows, particularly those where third parties are involved. Investment in data security and cloud-based infrastructure will be key to success. Providing the rails for broader partnering with third parties to banking services requires deliv...
The Connected Enterprise methodology involves market-leading research, maturity analysis, gap analysis (including business and technology blueprints), technology vendor shortlisting and effective implementation for all eight connected capabilities. Each of the eight enabling capabilities are underpinned by a set of five sub-capabilities. The first ...
Customer Segmentation and Insights Market, Industry and Sector Research Brand Value and Experience Strategy Interaction Orchestration Digitally-Enabled Supply Chain Workforce Shaping Technology Architecture Partner Strategy & Ecosystem Design
Commercial and Credit Insights and Business Intelligence Architecture (DGA) Operational Insights Data Governance &
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the fut...
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the fut...
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the fut...
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the fut...
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the fut...
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the fut...
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the fut...
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the fut...
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the fut...
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the fut...
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the fut...
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the fut...
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the fut...
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the fut...
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the fut...
Nov 30, 2016 · The financial ratios of banks play a significant role in determining the profitability and their relationship with economy. Internally, capital stability , cost and expenses, assets and...
This article examines the multifaceted contributions of commercial banks to economic growth, highlighting their functions in mobilizing savings, allocating capital, and providing financial services to diverse sectors of society.
In today's rapidly evolving business landscape, commercial banking plays a crucial role as a catalyst for entrepreneurship and innovation. Commercial banks not only provide essential financial services but also offer valuable resources and support to aspiring entrepreneurs and innovative ventures.
Jul 24, 2024 · Key Takeaways. Banking is a highly regulated system that ties our day-to-day banking back into the wider financial system. There are thousands of commercial banks in the United States alone.
People also ask
How does commercial banking support entrepreneurship and innovation?
What is commercial banking?
How do you understand commercial banking?
How are commercial banks changing their role?
Dec 19, 2019 · In its simplest form, the business model of commercial banks is to accept deposits from savers in order to make loans to borrowers; in other words, banks borrow from depositors and offer loans to individuals, business firms, nonprofits, and governments.
