Banks Have a New Secret Weapon: Design Studios

The rapid rise of FinTech startups seems to be throwing some shade on the banks basking in the sun. As payment technology evolves, FinTech startups are more imaginative in making money-handling easier for consumers. But on the other hand, banks are trying to adjust to this changing environment and the growing demand for customized services by leveraging the meaning of technology in consumers’ lives as it plays an increasingly important role in the rise of digital banking.

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Banks are coming up with digital studios/factories to foster startup-like innovations inside the banks. Banks are trying to set up entrepreneurial environments within their organizations to invent the newer versions of digital banking. Here is a list of a few such banks that have come up with their own digital studios for promoting innovation:

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Capital One: The design studio from the bank Capital One Digital, designs experiences that empower customers in managing their finances. The main aim of the studio is to promote collaboration across design and development. In October 2014, Adaptive Path, a San Francisco-based design and user experience consultancy, was acquired by the financial firm, followed by the acquisition of another Oakland-based design and development firm Monsoon in July 2015.

BBVA: BBVA acquired San Francisco user-experience firm Spring Studio in April 2015. The digital firm has helped design digital products and services for Fortune 500 brands and startups. The bank made the acquisition to improve the look and feel of its digital banking services. Founded in 2001, Spring Studio continued operating as an independent company, though it now focuses on BBVA projects. What BBVA wants out of this acquisition are innovative products and customer journeys that delight users, solve problems, and drive real business results. Acquisitions are part of the overall strategy of BBVA to lead the technology-driven transformation of the financial services industry.

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ADIB: Abu Dhabi Islamic Bank (ADIB) will be building a digital design studio to improve the user experience for its digital and mobile banking applications. The bank is already working with IBM on the project. The bank is applying the vendor's MobileFirst for iOS Banking apps and Bluemix cloud technology to speed the development and deployment of future releases. The design studio will include experts from IBM Design and IBM Interactive Experience. They will work side-by-side with ADIB to create a new generation of apps that provide a more engaging and elegant user experience to fend off competition from nonbank competitors.

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Citi: Citigroup demonstrated dedication to collaboration and superior customer experience with the announcement of setting up a new FinTech unit in its global consumer bank to focus on mobile banking in October this year. Heather Cox, who oversaw digital banking and client experience, will run the Citi FinTech team within the consumer bank. In addition, Citi FinTech will recruit employees internally and externally who will work collaboratively on cross-functional teams.

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Wells Fargo: Wells Fargo launched its digital labs in September 2014. The lab aims to develop digital solutions to simplify customers’ financial lives and help them succeed financially. Some of the ideas being tested at Wells Fargo digital labs include banking with a smart TV or connected home and video banking technology.

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The Bank of Nova Scotia/Scotiabank: The bank announced the development of a new digital factory that will pursue, design, and deliver digital innovations and solutions for the bank’s customers. Scotiabank’s main aim behind this digital factory seems to be to deliver the best customer experience to its 21 million customers. Scotiabank’s digital factory, fully operational in 2016, has already begun the work. Three customer-driven innovation labs, known as Rapid Labs, are already in action.

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