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Charting the route to opportunity in 2020

Explore three new models for banking success—the niche digital provider, the digital, full-service bank and the big box bank.


Opportunity. To realize it in 2020, banks must choose the banking business model that is right for them. There are many options, and banks can adopt one overall model or different models for different business units.

Convergent disruption is changing banking—and today’s institutions must find tomorrow’s true north. Most traditional full-service banks will retain this business model, with different degrees of success, while others will become digital full-service banks, big box banks or niche digital providers.

This banking business model evolution will be about action—not absolutes—because every bank has its own path ahead. The rationale and preference for particular business models will vary, by bank and even by business units at the same bank.


The digital full-service bank is appealing to larger banks with a high-risk/high-reward tolerance and requires investment in new platforms and banking innovation. Also high-reward, but with moderate risk, the niche digital provider suits specialized small-to-mid-size banks or mid-large banks that want to divest parts of the business. Finally, the big box bank is low-risk/low-reward and appeals to large banks that want to dominate the mass market. The investment, return and journey will vary for each model and bank.

Whichever banking business models are selected, banks can also explore innovative strategies to further sustainable competitive advantage. Consortium strategies can drive cost savings.

White-label strategies offer personnel, products and processes for others to sell under a different brand. Product expansion increases foot traffic and sales.

Banks must start building the groundwork for 2020. Success means proactively investing in the business, becoming customer-driven and embracing banking in the digital age.