“We don’t invent new products, but make experiences better,” said Ralph Hamers, CEO of ING Group, the Dutch bank. “We differentiate ourselves on how we do things, not what.”
It might seem somewhat surprising, considering ING is perhaps best known for its early adoption of digital engagement in markets like the U.S. and Spain where, via its ING Direct unit, the bank’s presence is completely virtual. As the third largest bank in Germany (after Deutsche Bank and Commerzbank), it signs an average of 1,000 new customers every day. 98% of ING Germany’s customers are in contact with the bank only via a smartphone or computer.
But digital firsts have never been the goal.
“Even without current technology, our goal was always to make our offering simple, available, and empowering to our customers,” Hamers explained. “The winners in disruptive models are focused on experiences, not gadgets.”
The company has delivered a number of experiential improvements, from aggregation of money management products and advanced investment advice, to seamless, instantaneous business lending. It recently announced it had successfully tested trading fixed income assets via block chain, which could radically simplify and speed the way transactions get done.
In Germany, where the traditional process for opening a bank account required someone to visit a post office with proof of identity, it introduced sign-up utilizing a webcam for the same purpose. The process takes much less time, and fraud is much lower, too.
None of these innovations would have been possible without digital technology, of course, but it is as much marketplace context as a delivery tool for ING.
“Digital usage is giving customers higher demands for insights into their finances.”
Hamers said that an emergent model of access is replacing the old static view of assets, and that it’s prompting innovations on improving financial literacy and awareness, and consultative work with business clients to reimagine new ways to monetize their offerings. It’s also looking at models for sustainability that help clients see waste as an input, not an output or value externality.
Digital is also present in how ING develops and tests its innovative ideas, allowing for a quicker, agile scrum approach to solving problems to replace the linear and far more lengthy processes it once used. It organizes multidisciplinary teams and funds them with small amounts of cash, and then tasks them to succeed or fail in 90 days.
Tests are external, too; It brought a new payments platform to market in Belgium in six months, and ran a successful pilot with 5000 students. According to Hamers, that’s a “strange thing for banking.” It didn’t set out to build an app, but rather to simplify and speed in-store purchasing.
“Next generation customers don’t necessarily have relationships with banks,” said Hamers. “As long as we give them the right information and tools to make decisions for themselves, we’ll be staying true to our customer promise.”
“I think it all starts with what we stand for.”