A new research report from Cornerstone Advisors reveals that while nearly half of mid-size bank and credit union executives are more optimistic about 2021 relative to 2020, they remain especially concerned about the interest rate environment and a weak economy.
A key finding in this year’s report revolves around digital transformation. Just a handful of surveyed institutions indicate they have completed their digital transformation strategy. “Quite frankly, we have our doubts about that,” the report counters, “as all of them didn’t even launch a strategy until 2019.” Based on survey responses, Cornerstone estimates that most institutions have a six- to eight-year timeframe to complete their digital transformation journey.
Other select study findings:
Both banks and credit unions consider revenue generation opportunities a technology spending priority this year.
42% of banks and 35% of credit unions are very interested in partnering with fintechs for digital account opening in 2021.
The number of executives who see Big Tech firms (Apple, Amazon, Google) as a major threat declined significantly from last year.
The percentage of banks placing a high priority on commercial real estate loans dropped sharply from 76% in 2020 to 45% this year.
The report also presents Shevlin’s Top Trends for 2021, which explores shifts in the financial services value chain across a number of areas including small business relationships, fintech-as-a-service platforms, and fintech-powered core system workarounds.
“Changes (or disruptions) to the value chain have certainly been in the works for a while now,” Shevlin maintains, “but 2021 is going to shine a much brighter spotlight on those activities—making 2021 the year of value chain disruption in banking and fintech.”
This year’s report is the result of Cornerstone’s sixth annual What’s Going On In Banking study.
Cornerstone Advisors, a management and technology consulting firm, brings innovative insights and execution to help banks and credit unions reach the next level of performance. For more information, visit crnrstone.com.