In the past month, major banks have taken drastic steps to save both reputation and fend off attacks from competitive markets. Alison Rose, the current head of the Royal Bank of Scotland, has said the New Year has brought with it a new set of challenges.
The RBS honcho recently claimed that the bank needs to shift its focus to its digital branch Bo as it plans to elevate it in the midst of a revamp. Rose added that the current watch needs to be conducted due to the issues related to the NatWest Markets.
Bo works as the digital arm of the bank with its Chief Executive Officer Mark Bailie set to quit this coming week. In the recent time frame, Bo has had to issue 6000 customer cards to ensure that they comply with newer regulations on the digital finance front.
With Alison Rose now heading the company, shareholders have projected a renewed interest in digital commerce. This comes after issues were raised about Bo since its launch three months ago. A source close to RBS added:
“Bo remains a key part of the bank’s innovation strategy, along with other brands we have launched such as Mettle and Tyl. We are focusing on the areas where we can have the biggest positive impact on our customers.”
Despite the hype created by RBS, financial experts have yet to give it a solid thumbs up. They feel that Bo has a lot of ground to cover before it can make a significant impact on the financial industry. Vincent Vinatier, a porfolion manager at AXA Framlington opined that RBS was not even on his radar. He admitted that Bo did not rank very high in the fintech list as well.
Many proponents of the fintech space have admitted that the real key challenge was to keep customers with the main bank brand ie. RBS. Bo has functioned as an attractive model for RBS and at the same time has not resulted in major losses for the company. Some others believe that the digital bank’s functionality was on the road to improvement while making the industry more competitive.
At the moment, Bo was seen as a savings tool for current customers. Analysts were open when stating that Bo does not compare with existing tools in the market. Some have reported that customers see Bo as just an extension tool and not just a mainstream feature. Another investor stated:
“These new competitors are not yet gaining a great deal of traction as main accounts for many customers – many seem to be using them for specific limited purposes and retaining current accounts with the big incumbents.”
The last time RBS was in the news was when the bank ordered its customers to shred their cards to comply with EU rules. The reissued cards come with multiple capabilities such as chip and pin transactions.