AWS for Industries

New release: AWS digital banking microsite

Digital banking growth has accelerated

The global banking landscape has experienced significant change over recent years. Customers increasingly expect an always-on, fully digital and personalized experience in their daily life, triggering changing expectations around their banking services. A confluence of industry drivers—heightened customer expectations, new regulations (such PSD2 in EU/UK, and new digital only banking licenses across Asia), the sophistication of new data analytics tools, and the maturity of APIs—has accelerated the pace of digital banking across the globe.

Digital channels have become the dominant path for customers of all ages. Based on a study by McKinsey, branch contribution to core banking unit sales had fallen from 75% in 2015 to 55% in 2019. The COVID-19 pandemic has further accelerated the shift to digital in banking. The same McKinsey study also found that consumers are likely to sustain their new digital behaviors and visit branches less often following the pandemic.

A new resource to build and scale digital banks on AWS

To help digital bank customers accelerate time to market and de-risk implementation in this highly regulated and complex industry, we launched a new microsite to feature stories of digital banks that have built and scaled on AWS. It also highlights the wide variety of AWS Partner Network solutions used by financial services customers globally.

This site provides best practices across established enterprises and innovative challenger banks, as well as AWS partner resources such as whitepapers, blogs and technical resources. You’ll also find more information about the different types of digital banks, including: Challenger banks, independent start-up banks with a banking license (e.g., Starling Bank, Judo Bank, Nubank); Digital bank offshoots, subsidiaries or extensions of existing incumbent banks (e.g., Mox by Standard Chartered, Openbank by Santander); and Banking-as-a-Service (BaaS) players, which are licensed banks provisioning complete banking processes (such as loans, payments or deposit accounts) as a service using API-driven platforms to non-banking brands (e.g., Solarisbank and Standard Chartered’s Nexus).

What characterizes a digital bank?

From our work with digital banks globally we have seen some reoccurring patterns emerge that made these digital banks more successful than their peers. Here are four characteristics that we found mattered the most:

  • Data-driven: Uses data to drive decisions that impact the customer and the operating model
  • Leverages ecosystems: Takes advantage of data and services via APIs from other banks and non-banks
  • Customer-centric: Focuses on customer behaviors instead of products and services
  • Fully digital user experience: Offers banking services on any device at any time, including onboarding and cash services

Building digital banks in the cloud while staying compliant

With AWS, digital banks, supported by our financial services industry compliance specialists, can build secure, scalable, and innovative business models in the cloud while staying compliant with regulatory requirements.

AWS meets with regulatory agencies throughout the world to shape emerging digital banking license frameworks. We know that digital banks are most successful on the cloud, so we share with regulators how we approach security and compliance and present the various tools and services that enable financial services customers to build secure, scalable, and innovative digital banks with AWS.

We will continue to be at the forefront of engaging regulatory agencies as they consider, propose, and update regulatory requirements that affect AWS and our customers. Our goal remains simple – to seek the best policy and regulatory outcomes for our financial services customers to build on the cloud. We are committed to deliver an operating environment for our customers to innovate with confidence. As digital banking regulations continue to advance, AWS is committed to help customers respond to new rules and guidelines.

How to get started

If you have any questions about how to leverage the AWS cloud when building your digital banking proposition, please reach out to your account representative. We have a team of digital banking specialists, policy, regulatory compliance, and technology experts with financial services backgrounds ready to support you. Further you can refer to our AWS Digital Banking microsite for customer success stories, AWS partner resources, technical guidance, and best practices from other digital banking customers to help you get started.

Felix Thummernicht

Felix Thummernicht

Felix is a Banking Specialist on the Worldwide Financial Services team at AWS. Felix is responsible for developing and executing cross-functional plans for digital banking initiatives in Asia Pacific. Felix has 10 years of experience in financial services technology. Prior to joining AWS, he was with EY’s Financial Services Consulting business and has worked in Hong Kong and Singapore. Felix is a certified Scrum Master & PMP (project management professional), specializing in agile delivered technology transformation projects in the banking sector. His experience in banking spans Target Operating Model (TOM) and multi-country transformations, bancassurance system implementations, and financial crime technology programs. Felix holds a bachelor’s degree from University College Dublin.