How you’ll bank in 2035

Characterised by digital banking solutions unimaginable today due to the continued influence of future trends, the SA banking industry is set to be vastly different towards 2035, according to academic Ruellyn Willemse-Snyman.

In response to advancements in digital banking, the country’s four big banks – Absa, Nedbank, FirstRand and Standard Bank – found themselves on a collision course with labour when they threatened to massively cut staff.

Willemse-Snyman, philosophy master in futures studies at the University of Stellenbosch Business School, foresees banking as one of the many industries that would experience multiple iterations in decades to come.

“We live in a world where billions of people are hyper connected to one another, as well as to everything found in the contextual environment in which they actively participate. This ... creates a platform for real-time and seamless transfer of innovation and technology.”

This will cause continuous client behaviour changes and constitute the building blocks for the digitisation of the banking industry.

While the four banks, categorised as “traditional banks”, dominate the market, Capitec – one of the most recent entrants to the market – has disrupted the local banking industry landscape since being established 18 years ago.

“The continued introduction of change as well as new digital-only banks, such as Thyme Bank, Bank Zero and Discovery Bank, will lead to an increasingly complex and competitive banking industry towards 2035,” she says.

The digitisation of the banking industry, application of innovative banking solutions and enabling technology necessitate the establishment of new regulations in order to counter the increase in security risks.

“Banks will have to come up with innovative solutions, which may include the adoption of a digital core operation platform enabled by technology and innovation as well as innovative business models.”

“The key solution to combating cybersecurity is through the establishment of partnerships between banks and third parties that can supply financial solutions, enabling clients to have access to digital financial solutions.

“This will provide clients access to their banking functionality, while providing the privilege of a strictly controlled banking environment,” she said.

The continued introduction of change ... will lead to a complex and competitive banking industry.

Ruellyn Willemse-Snyman University of Stellenbosch Business School