Digitalisation strategies in a South African banking context: A consumer services analysis

Background: In the advent of the fourth industrial revolution, Internet-only/digital-only banks are offering alternative approaches to facilitating online transactions and banking in the absence of physical branches. As a result, traditional, offline banks may possibly experience increased pressure in growing and retaining their customer base. Objectives: The objective of this study is to understand the fundamental differences between traditional and digital-only banks’ business models and digital user experience strategies from a consumer services perspective. As a result, in this research, we established to what extent traditional South African banks have embraced service digitalisation and compared this to the services offered by South Africa’s first digital-only bank (launched in early 2019). Method: By means of convenience sampling, we selected the five biggest traditional banks and the first digital-only bank in South Africa (as recorded at the start of July 2019) and conducted a comparative analysis of the core digital services that were offered to consumers. Results: Overall, mobile-optimised services were identified as a key digital business strategy, thereby highlighting the importance of a mobile-first approach not only to traditional and digital-only banking services strategies but also to digital business model formulation in general. Conclusion: While the overall South African banking landscape and banking user experience may be moving towards digital-first and mobile-first, the need for access to banking technology and services 7 days a week necessitate not only mobile-first, but accessible-foremost (i.e. access to infrastructure that facilitates access to online banking technologies, both remotely and on premise) banking business models.