Head of Credit Solutions
Savings Banks Group is transforming lending with Tietoevry Banking’s lending software. Pekka Suomalainen and Pär Johansson analyze the trends driving the change.
Finland’s oldest bank, Savings Banks Group, has long assisted people in saving money, fostering prosperity and supporting their life goals while contributing profits to local communities. Lending remains at the core of its operations.
Now the group consisting of 14 independent banks is transforming their way of doing business without compromising their DNA. Business transformation is underpinned by two prevailing trends.
“A sizable portion of our customers are relocating from smaller towns to cities and the capital area. To be competitive in the new areas, we need to provide digital services in parallel to personal servicing. This means automating lending processes, which are pre-dominantly manual,” says Pekka Suomalainen, CIO, Savings Banks Group.
Servitization as another trend
Suomalainen also points out another trend; the rise of new digital service-oriented competitors challenging current banks and financial institutions.
Pär Johansson, Tietoevry Banking’s Head of Credit, agrees.
“Apple, Meta and other servitization companies have taught consumers what digital servicing at its best can be. The ethos has spread to banking and other industries in Northern Europe.”
Johansson further elaborates on the challenges:
“Established companies are experiencing new competition from players like Revolut, Klarna and other niche banks, who are free from technical dept and can quickly provide a full spectrum of easy-to-use, well-designed services. This means that all Banks need to consider transformation in one way or another.”
The best combination of digital and personal
So, what does the road ahead look like for Savings Banks Group?
The bank will invest in enhancing customer-centricity by building the best combination of digital and personal experience in lending.
Tietoevry Banking, the lending modernization partner, will deliver their lending software, i.e., the Lending Suite including loan origination, life-cycle management and collateral management for consumer and corporate financial products over a 3-year project.
The modernization is done in liaison with a CRM (Customer Relationship Management) renewal. Overall, Savings Banks Group is investing more than €100M in digitalization, which is the largest investment in the bank’s 200-year history.
“We aim to optimize our advisors' time to focus on customer service by reducing background work drastically while fostering agility in our IT infrastructure development. The goal is to be able to adapt swiftly to new lending business requirements at any time,” says Suomalainen.
Johansson adds that the change is an investment to ensure the future competitiveness of the bank group.
“High automation delivered through cloud will also speed up the time to market for new lending products, giving Savings Banks Group the first mover advantage."
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“We aim to optimize our advisors' time to focus on customer service by reducing background work drastically while fostering agility in our IT infrastructure development. The goal is to be able to adapt swiftly to new lending business requirements at any time." Pekka Suomalainen, CIO, Savings Banks Group |
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How has the lending transformation of Savings Banks Group kicked off? The project started in September 2023. You will learn more about the current success and Finnish Savings Banks Group’s previous failure in the next “Transforming business” story to be published next week. Stay tuned!
Want to hear more about Tietoevry Banking’s Lending Suite? Kristian Hovden is happy to help.
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