The European Central Bank has highlighted six key areas of focus for banks in their digital transformation journeys. The list is the result of the ECB’s consultation with banks, industry bodies and national supervisors in 2022, together with a survey of 105 banks across the EU.
In a February newsletter article, the ECB said “Banks still find it difficult to isolate and quantify the cost and revenue impacts of their digital transformation strategies and processes.”
The full list of six challenges listed by the ECB was:
1) Lack of KPIs to monitor digital progress, quantify the impact of digital transformation and track the effectiveness of implementation.
2) Keeping track of digital customers and sales.
3) Lack of dedicated digitalisation budgets.
4) Ensuring that there is sufficient IT experience in the board and in decision making roles to ensure adequate internal governance.
5) Continued integration of innovative technologies.
6) Risks associated with increased reliance on third party technology vendors.
The ECB said it plans to build on this preliminary analysis with investigations, on-site inspections and reviews of banks and shape future supervisory guidance.
[Image Source: Corporate Finance Institute]