As reported in Delano, a recent survey carried out by Deloitte found that Luxembourg banks are behind with regards to digital maturity. Indeed, the study classified Luxembourg banks as “digital adopters” rather than digital leaders and encouraged them to, “review their digital strategies in order to keep up with the rising appetite of digital consumers,” as well as, “…get the full picture of the market, so they can understand their next course of action.”

Regular readers will be aware that Delano is not keen on surveys and studies that present results, but little context (however well-meaning they may be). In order to get a better idea of how Luxembourg banks are dealing with digitalisation, we talked to Olivier Debehogne, head of digital banking at Bil, who explained that, “Luxembourg banks in general may be a bit behind, but we are catching up fast.”

“Over the past few years, the Luxembourg financial centre has undergone major structural changes that also pushed banks to be more proactive towards their clients and to speed up their digital transformation. We must adapt, transform and innovate to meet client expectations. Banks can no longer rest on their laurels,” he said.

This cannot be done overnight, however. Indeed, at a recent press conference the Luxembourg Bankers’ Association (ABBL) set down its priorities for 2018, one of which is to maintain the integrity of the financial system during the digital transformation. Chairman Guy Hoffmann stated that, "The same services and the same risks must be subject to the same rules and supervision. The preservation of the financial system, as well as the protection of the client of the financial services, are essential for its proper functioning."

Luxembourg banks are not dragging their heels then, they are just taking care.

“Our digital strategy is to improve the overall client experience,” explained Debehogne. “Our goal is to make banking much easier…This will result in digital services with new features.”

The challenge is to manage clients’ expectations. “Expectations have evolved due to the rapid adoption of new technologies. Clients are more connected anywhere and anytime with mobile devices. Internet giants such as Google, Apple and Amazon are setting new standards and clients expect the same level of service from their banks.” 

Meeting clients’ hunger for new technology and more digital services, as well as ensuring the integrity of the financial system has become a delicate dance. Clients want the same level of service as that offered by the internet giants, but they also need to be certain that they can continue to trust the banks. Banks have to meet their clients’ needs and deal with the increasingly complex regulatory environment, including the risk of dawn raids as reported here.

The recent Cambridge Analytica/Facebook affair has made people much more aware of issues of trust. If a social media platform can mishandle data to such an extent, what mischief could a bank get up to considering the amount of personal information it holds? Enter GDPR (general data protection regulation).

“Data protection is not new to banks.It is essential in our activities to create the necessary trust and I believe GDPR can only improve our relationship with our clients,” said Debehogne. “Increased transparency on how personal data can be used will strengthen this trust.” 

Debehogne is confident that Bil will be ready for the GDPR implementation deadline, but added, “Data protection is a continuous exercise that will not end on 25 May 2018.”