Indian Banks Can Outperform Global Peers In Digital Maturity Score: Report

A report released today revealed that Indian banks are outperforming their global peers in digital maturity score compared to the global average and have the potential to become the ‘Digital Champions’ surpassing the banks worldwide.

The Deloitte, Digital Banking Maturity (DBM) survey examined 304 banks in 41 countries, including key economies, such as the US, China, India, the UK and Brazil, marking a significant achievement as it is the first time the Indian subcontinent has been brought under the extensive purview of DBM. 

The survey evaluated banks on 1,208 digital banking functionalities spanning six customer journeys throughout the retail customer lifecycle – ranging from information gathering, account opening, customer onboarding, day-to-day banking, expanding relationships and ending relationships.

Based on the survey outcomes, 304 banks were classified into four distinct tiers. The top 10 per cent performers were recognised as “Digital champions”, followed by “Digital smart followers,” “Digital adopters,” and “Digital latecomers,” respectively. A bank’s position in the index is determined by its level of digitisation across six customer journeys, broken down further into 17 customer journey sub-steps.

Indian banks displayed noteworthy performance in the survey, surpassing the global average in several key customer journeys. Being at the forefront of digital transformation, Indian banks are well-placed compared with the global average, the study emphasised.

The 1,208 functionalities scored were split almost equally between Internet banking features and mobile banking features. Indian banks scored 3 per cent higher than the global average in mobile banking and 1 per cent higher in internet banking. They bagged the titles of “Digital smart followers” and “Digital adopters”.

The study underscored that compared with "Digital champions”, Indian banks have a significant opportunity to increase their digital maturity, particularly in two customer journeys – day-to-day banking (while UPI is a unique and globally recognised lever, the delta is more about Personal Financial Management and Beyond Banking) and expanding relationships. 

Within the two customer journeys, the survey found that the most relevant sub-steps offering significant potential for value creation are personal financial management, beyond banking, ecosystem and account aggregation and account and product management. For instance, at the time of the examination, a notable 25 per cent of the Indian banks offered the functionality for customers to set their financial goals, while 57 per cent of digital champions did so, the Deloitte study added.

At present, “Digital champions” enjoy a lead in their digital transformation endeavours across customer journeys and provide a compelling user interface to customers. By making strategic investments, particularly over the past two years, "Digital champion” banks have gained a significant advantage over their peers. During the measurement period, Digital champions, on average, showed 0.1 per cent higher return on assets and 1.5 per cent higher return on equity compared with their peers.

Commenting on the findings, Vijay Mani, Partner, Banking and Capital Markets Leader, Deloitte India, said, "While there is no one size fitting all banks across the globe when it comes to digital maturity, banks in India stand to gain significantly from selective comparison – comparing specific journeys, sub-steps and features, and cherry-picking.”

The survey was aimed at gauging what global leaders are doing to stay ahead in the digitalisation race. DBM is a part of Deloitte’s Digital Banking accelerator suite, which empowers banks to adopt and respond to change.