Reflections on the FCA Retail Banking Business Model Report

By Gobeyond

The final report from the FCA on retail banking business models, released in January, provides some valuable insight into the challenges, opportunities, and considerations for retail banks in the UK. The report reflects on the changes in consumer behaviour, the impact of the pandemic and the increasing market competition, highlighting key areas of consideration for all retail banks. In this summary, Vicki Butcher, Client Partner discusses the following four key areas of focus from the report and provides a series of recommendations for retail bank customer and operational leaders to consider:

  1. Optimising branch networks to maintain channel choice and access to cash
  2. Creating agility to maximise revenue opportunities
  3. Scaling for growth in a digital bank
  4. Harnessing the need for non-standard lending

Optimising branches to maintain channel choice and ensuring access to cash

The pandemic has certainly accelerated the level of change over the past two years, particularly in digital transformation. However, not all change is permanent.  Whilst it is likely we will see a continued rise in digital banking needs from consumers, the pace should be steadier.  As the FCA’s report highlights, customers who rely on cash, prefer a face-to-face service or have specific needs, may not be able to, or wish to, use digital channels.

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