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A new survey from the Economist Intelligence Unit (EIU) and Temenos has revealed that although digital technology is a major concern for bankers, finally overtaking regulation as a top priority, they’re not actually all that worries about it.

The report, the fifth in a series conducted for Temenos, offers a “global investigation into the strategic concerns of retail banking executives”.

Among the headline figures are statistics that reveal the changing nature of the banking industry as a whole. Open Banking has been a key topic of conversation in 2018 so far, yet while 71% of bankers are focusing their digital investment on cyber security, only 17% are thinking about the risks from third-party relationships as a result of the legislation.

The branch is experiencing an extremely slow death in the minds of the industry, as over 61% of respondents still see a place for the traditional transaction-based branch model, nearly twice as many as those who think it will be dead by 2020.

AI seems to be facing some teething issues when it comes to convincing those at the top of its usefulness. Only 21% said that the technology would change the way customers interact with their bank.

Investment is being spread across the shop by banks. Digital investments are being directed to digital channel delivery capabilities such as mobile (cited by 54% of respondents), cloud-based technologies (48%), and in modernising front- and back-end systems (37%).

Enlightened by digital

The EIU surveyed 400 global banking executives about the challenges retail banks expect to face between now and 2020, and the strategies they are deploying in response. 51% of respondents were at C-Suite level and 10% were board members. Respondents came from Europe (25%), Asia-Pacific (25%), North America (18%), Latin America (16%) and Africa and the Middle East (16%).

“Banking has reached a watershed moment with changing customer behaviours, disruptive new technologies and a dramatic increase in competitors from within and outside of banking. The most enlightened banks understand that to become truly digital they need to update their systems front-to-back,” said David Arnott, CEO of Temenos.

“This will fulfil their business need for product agility; they can offer the right products, over the right channel, and at the right time. Technology, as the report notes, is now the enabler, which will empower banks to build digital ecosystems and capitalise on the open banking opportunity.”

Renee Friedman, editor of the report from the EIU, added; “Although the banks may benefit from the fintechs’ missteps, they must remember that the trust customers have in their bank will mean little if it cannot provide the services that accommodate their lifestyle needs.”