The Russian banking
market is set for dramatic changes over the next four years, driven
by changing customer behaviour, intense competition and new banking
models, according to a report “Russia’s Banking Sector in 2015:
Winning the Battle for Customers”, conducted by
Accenture.
The survey was based on
interviews with 1,600 Russian bank customers and 30 senior bank
executives at major state-owned and private banks.
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According to the
research, nine out of ten Russian bankers believe that intense
competition is “inevitable” over the next four years and will be
driven primarily by reduced margins (cited by 90% of respondents),
declining customer trust and loyalty (cited by 80%) and changing
customer behaviour (also cited by 80%).
Alexandre Gorine,
managing director of Accenture in Russia, said:
“The banking market in
Russia is growing, but more slowly than in the pre-crisis period –
with revenue growth estimated at about five to ten percent annually
over the next three to four years.
“Meanwhile, the
marketplace remains fragmented and under-penetrated in terms of
high value, higher margin financial products – and demand for
channel and service innovation is rising.”
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By GlobalData According to the
consumer survey:
- The average Russian bank customer
currently uses three banks to provide an average of three banking
products; - The most commonly used banking products
are basic and transactional, with salary cards, debit cards, and
bill payment and money transfer services, used by 63%, 42% and 39%
of Russians, respectively; - Only 4% of Russian bank customers hold
investment products, 7% hold mortgages and 10% have car
loans.
According to
respondents, one of the three most important criteria for selecting
a bank is “innovative products and services.”
The survey also showed
rising demand for banking innovation among Russians, with more than
two-thirds of respondents (71%) reporting increasing expectations
for multichannel access, 66% expecting greater simplicity and
convenience from their banks; more than half (57%) said they
require faster service from their banks.
Nine out of ten Russian
bankers believe that they will need to transform their business and
operating models to adapt to changing market demands by 2015,
according to the executive interviews.
Eight out of ten bankers
cite areas like customer revenue growth, strategic cost reduction
and technology innovation as critical business challenges. But just
over one-third of executives (38%) said that transformation of
their business and operating model is currently among their bank’s
highest strategic priorities.
Dmitri Zaitsev, head of
Accenture’s management consulting practice in Russia,
said:
“Due to the scale and
complexity of moving from a traditional product-driven operating
model to one that is built around customer needs and behaviours,
many banks may find they lack the ability and readiness to embrace
such a profound change.
“Consequently there will
be winners and losers, leading to further consolidation of the
Russian banking market by 2015.”
According to Gorine,
“The winners in the new post-crisis banking landscape will be the
banks that are customer centric, efficiency focused, driven by
profitability objectives, much more multi-channel in their
distribution, with more diversified customer base and revenue
streams and with regional coverage.
“This will require
significant management focus, investment and change.”
