The UK incumbent is introducing a revamped retail banking model aimed at boosting revenues and reclaiming market share from neobanks, per the Financial Times. The improved platform will utilize video to increase access to human bankers, offer new low-risk investment products for mass market savers, and expand NatWest’s credit solutions. The bank is hoping to get the best of both worlds by gradually improving its digital app alongside taking a human-centric approach to banking.
NatWest could improve customer satisfaction and gain an edge over neobanks by digitizing incrementally and tapping into its existing advantages.
Despite its digital ambitions, NatWest could still face roadblocks that might impede its ability to compete against digital challengers. UK incumbents still rely heavily on outdated infrastructure to complete a large portion of functions, and they could lack the technical capabilities necessary to produce and maintain competitive digital products and services. It is unclear whether NatWest’s updated platform will be powered by legacy technology, but regardless, maintenance costs could limit its ability to roll out innovative digital solutions. The bank has also recently suffered several high-profile setbacks as it tries to compete in the digital space: It closed Bó, its consumer-focused standalone digital bank, last May after only six months, and shuttered Esme Loans, its digital lender, earlier this month. Because its digital upstart competitors don’t have to shoulder a similar technical debt that could hinder their ability to innovate, NatWest’s digital revamp could struggle to compete with these newcomers.