May 2021 | Technology

The technological balancing act

David Lownds is head of marketing and business development of Hanley Economic Building Society 

In the midst of massive internal and external tech overhaul, it’s fair to say that our eyes have certainly been opened to the challenges, time, resources and opportunities involved in such a project.

We also continue to learn a huge amount about our business, people, customers and intermediary partners throughout this process.

It’s important for any business to constantly evolve and strive to better service the shifting needs of customers.

The transformation of our systems to a more modern model not only reflects the innovative nature of our lending, and investment in meeting these obligations, but it also means that we now have a solid tech base in place from which we can be more receptive to further digital change.

As such, it was interesting to see a recent report published by Whitecap Consulting in partnership with the Building Societies Association (BSA), which highlighted that more than half (55%) of building societies view open banking as an opportunity. It went on to add that more than a third of respondents have not yet assessed the benefits of open banking for their business, with 10% viewing it as a potential threat.

Among building societies, 79% said that open banking would enhance the mortgage underwriting process, 76% suggested it would improve customer data connectivity and 71% that it would improve operational efficiencies.

The research also found that 93% of building societies said mutuality affects their decision-making; 66% said mutuality is about culture, values and social purpose, and 71% consider the branch network to be a critical part of regionality. The majority (90%) of building societies considered community involvement to be a commitment to regionality, 67% identified digital transformation as the primary challenge over the next five years, and 65% of all stakeholders surveyed belive open banking to be an opportunity for the sector.

According to the senior leaders interviewed as part of the report, digital transformation is the primary challenge for the sector over the next five years, while the need to remain relevant to customers and improve engagement were also cited as key priorities.

From our perspective, whilst we acknowledge our history and our ongoing commitment to our community, we also have to look to the future.

Open banking and open finance represent exciting developments, and building a better understanding of any potential borrower’s financial picture will become an increasingly powerful tool for lenders and intermediaries.

As a forward-thinking lender with a growing intermediary focus, it’s important to include ourselves in such conversations.

However, just as important is realising our tech limitations and making sure we don’t start running before our new systems can walk.

Whilst we do believe our new systems will open a new chapter in the book of an institution which is almost 170 years old, this will not lead us to ignore our history, or the people within our community that have supported us in the journey.

This is an example of the kind of balancing act which all mutuals are currently facing to varying degrees – but one which we are relishing.