Scotiabank, Canada’s third-biggest lender, announced that it was implementing new digital technology aimed at helping the bank cut its operating costs and increase revenue.
With less of its client base coming into branches and more of them choosing to utilize online banking and mobile apps to complete their banking transactions, Scotiabank believed it was prudent to implement the new technology in an effort to better serve its customers. According to Reuters, the bank also plans to cut 5 percent of branches in the next two years.
“Our customers want to do more of their banking through digital channels,” Scotiabank President and CEO Brian Porter said in a statement, “and we want them to conduct more of their business with our bank. Our digital-first mindset should send a clear message to customers, employees and shareholders: When it comes to digital banking, we are positioning Scotiabank to lead.”
The statement goes on to reveal that the digital transformation will extend across the bank, from sales and marketing to risk and technology. Scotiabank has been working on a cost efficiency program since last year, with the goal of meeting a 200–250 basis point improvement in its productivity ratio by 2019. The introduction of this new digital technology is expected to result in an additional 100 basis point improvement beyond 2019, giving it a productivity ratio of about 50 percent by 2021.
The majority of the additional efficiency improvements relate to lower operating costs and making it easier for customers to do business across digital platforms. This also extends beyond Canada: Scotiabank has the biggest international presence of all of the country’s banks. With that in mind, the bank opened new facilities to develop technology, such as blockchain and artificial technology, to make sure customers can make international transfers safely and efficiently.
“We intend to be a digital leader in the financial services industry, not only here in Canada but also in our key Pacific Alliance markets of Mexico, Peru, Colombia and Chile,” said Porter.