Innovation in Banking –

SEB Estonia case

Eerika Vaikmäe-Koit

April 18, 2012

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Innovation – success factors for Estonia

• Small and accessible market

• Lack of heavy „back-log“, old systems and ways of working – no need to change customer behaviour

• Timeliness – desire of the society to change

• Open market, technology easily accessible

• Strive for simplicity

• Vision and leadership

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• Increasing customer demands with special focus on personalisation, privacy and security

• Mistakes are especially costly – „fail fast“ solutions not an option

• Customers’ need for simplicity not in line with development of banking regulations

• Banking is not an area on top of people’s minds -more difficult to engage your customers

The main challenges of innovation in banking

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5

Closing the delivery gap

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Delivery cap

Source: Brain Customer-Led Growth Diagnostic questionaire;

Satmetrix Net Promoter database

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Public pages

Private Internet bank

Mobilebank

Corporate Internet bank

2011: All SEB Estonia digital channels upgraded99% of transactions are made in digital channels

Awards in 2011:

• The Best Bank in Estonia 2011 (The Banker)

• The Best Bank in Baltic and Nordic Countries 2011 (Euromoney)

• The Best Internet Bank in Estonia 2011 (Metasite)

• Most satisfied customers among leading banks (EPSI)

• Customer Voice indicator – NPS - increasing

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Getting personal doesn't mean getting physical…

Face to face branch banking, ver. 1.1”

Face to face internet banking, ver. 1.2

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Total visits per month

0

50 000

100 000

150 000

200 000

250 000

300 000

01 2010 04 2010 07 2010 10 2010 01 2011 04 2011 07 2011 10 2011 01 20120

200 000

400 000

600 000

800 000

1 000 000

1 200 000

1 400 000

1 600 000

1 800 000

Internet+3% YoY

Branch-36% YoY

CC*-9% YoY

Bra

nch

, M

ob

ile,

Postb

an

k &

C

CIn

tern

et & A

TM

*Answered e-mails and calls

Postbank-4% YoY

ATM-2% YoY

Mobile

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Anticipating the customer journey Example – Mortgage purchasing process in the Netherlands

SOURCE: Customer market research in the Netherlands (~500 people interviewed)

In the

Netherlands,

for mortgages40–85% of

customers

continue

using the

branch

throughout

the

purchasing

process

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Design channel integration as one customer journey

Internet

Mobile

Phone

Branch

Awareness

Informatio

n

AdvisePuchace

Post sale

support

Banking innovation going forward – the winner is a step ahead of customer needs

Design seamless multichannel service journeys

Faclitate personal and meaningful meetings with your customers in all channels

Dominate the dominant distribution channel – the competition is not just between the banks

Invest into mobile channel development

Innovation is created in cooperation with the customer

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Thank you