In the pursuit of deposits, some financial institutions are exploring a distinct digital brand. Marcus by Goldman Sachs is an example of a “purpose-built” brand connected to an established bank. Goldman Sachs decided it wanted to attract more retail customers and created Marcus to help them do that.
This approach offers a lot of room for exploration and growth. You don’t need to throw away the credibility and balance sheet of your current institution to spin up a new brand. It’s an opportunity to start fresh, using the expertise from your existing institution to build a nimbler, more innovative one. The magic of digital banking allows both realities to exist without harming either one.
Once upon a time, a proposition like spinning up a digital brand would have required immense capital and a commitment to building the technology stack in-house. Today, there are many fintech vendors offering plug-and-play solutions so you can shop “off the shelf” and create a banking experience that fits your goals — with one significant caveat: Profitability. It’s not sustainable to operate loss-making experiments indefinitely. The need for careful planning on the front end can’t be overstated. According to consulting firm Bain, many institutions and their digital brands are grappling with the issue of ROI right now.
Check out Kathleen’s full article published on bankbeat.biz
