Banking in the new reality

By Celeste Diana

KPMG’s recent report, Banking in the New Reality, focused on six key themes that have accelerated during the pandemic, and that we believe are critical for future success.

1.     New distribution channels reconfiguring the landscape

2.     Harnessing the shift to a digital economy

3.     Cost priorities reimagined, new operating models emerging

4.     New ways of working becoming the norm

5.     Writing a whole new risk management playbook

6.     Values and purpose front and center

In this News & Perspectives article, Celeste Diana and Robert Ruark provide their thoughts on the theme: harnessing the shift to a digital economy.

According to Ruark and Diana, they have seen a tremendous adoption of digital in the banking industry – starting in the largest banks but now moving aggressively into the mid markets. The adoption goes well beyond just contactless transactions – the digital economy is much broader than that – it is not just about payments.

Diana continues that in a digital economy, the consumer is in control of their financial experiences. “The digital economy comes through experiences; your experiences anywhere become your expectations everywhere. That is what competing in a digital economy is really about.”

Diana says it’s about human interaction being a consumer choice and not a requirement based on gaps in banking capabilities, technology and operations.

“Looking at it from a bank’s perspective, how you participate in that economy is up to the organization. Do you become the platform or vehicle to drive change? Do you become a passenger in that vehicle or do you find ways to differentiate and participate in that economy and if so how,” she says.

“Banks need to sharpen their pencils to determine what their digital business model is and where they want to play. This is my proposition, my brand and how I want to expose those experiences to my customers.”

Ruark says, “New business operating models and distribution channels need to be implemented to serve the new economy and consumers, whose demands for a digital experience are intensifying every day.”

“The banks that don’t have the resources to implement their digital implementation plans are looking to fintechs and other companies to partner and collaborate with to move their plans forward,” he adds.

Access the report


In the past Diana says banks spent significant time and investments in incremental digitization initiatives, but now realize fundamentally how big this transformation is.  “Instead of looking at the transformation from a bottoms up approach, they are now looking at it from a top down view – where do we want to differentiate ourselves, how do we want to deliver innovation to consumers – picking and choosing where to make the biggest investments for the biggest return of value. That is what is different.”

Diana and Ruark say digital has leveled the playing field for smaller banks.   

Historically, large banks dominated because of their national distribution channels. They could be everywhere all the time and have a brand that was physically present in almost every market. 

Digital removes the geographic constraints and evens the playing field. Anyone who has a great digital product can be anywhere.

“Regional banks can pick and choose markets to compete in and execute a lot quicker at scale, and deliver innovative products to market sooner – leveraging digital capabilities to reach consumers in place of sinking costs into establishing a physical presence and the supporting operational infrastructure,” says Diana.

Ruark adds, “It is less about size and more about focus. The banks that are focused on deploying digital and thinking of it strategically will be the ones much further ahead.”

Next:  We will focus on Cost priorities reimagined, new operating models emerging

For more information, please contact Pete Settles @pgsettles or

Media contact

Pete Settles

Pete Settles

Director, Corp. Comm., Financial Services, KPMG US

+1 201-505-6065



Celeste Diana

Celeste Diana

Principal, Corporate Strategy, KPMG US

+1 516-456-1863
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