Digital Transformation: What’s Next for Middle Eastern Banks?

Key Stats at a Glance

• 78% of respondents believe their firm’s legacy systems and infrastructure are hindering them from providing the digital experiences their customers expect.
• 73% admit that evolving customer expectations have highlighted weaknesses in their organization’s current customer experience.
• 49% cite cybersecurity as their company’s number one priority over the next three years.
• 43% of Middle Eastern banks have a fully agile operating model in place.

Top Priorities for Digital Business Transformation in Middle Eastern Banks:

• 18%: Improving cybersecurity
• 13%: Growing revenue with new products and/or service offerings
• 12%: Growing revenue from existing products
• 12%: Acquiring new customers
• 12%: Enabling greater agility
• 11%: Reducing costs through improved efficiency
• 11%: Challenging the threat posed by new market entrants (e.g., Google, Apple, Amazon)
• 10%: Improving the customer experience

Main Barriers to Digital Transformation:

• Lack of Budget: 40% say lack of budget has been the biggest barrier to their digital business transformation efforts.
• Regulatory Challenges: 38% said that changes in regulation were a key barrier to digital transformation.
• Legacy Technology: 34% said that old technology and legacy systems were the main things holding them back.

Personalizing Customer Journeys is a Priority for Middle Eastern Banks

Banks are looking to use data to create new products and services that deliver more personalized omnichannel experiences.

• 40% say that personalized customer journeys (e.g., tailored marketing, personalized saving tips based on individual spending habits) is their top customer experience (CX) transformation priority.
• 39% are focusing on creating new or nontraditional financial services and products (e.g., travel booking) as a central part of their CX strategy.
• 36% are prioritizing omnichannel services to advance their CX transformation by making products seamlessly available across all channels.
• 36% state that offering new distribution channels for traditional products and services is their top priority.

Middle Eastern Banks are Transforming How They Operate

Banks are transforming to survive in the customer-centric digital era. Their transformation priorities extend across people, partners, technology, and culture.

Developing Talent

• 36% said that investing in existing talent (e.g., upskilling, reskilling) is an operational priority, compared to 32% focusing on acquiring new talent.

Strengthening Networks and Ecosystems

• 34% said that strengthening their partner networks and ecosystems was at the top of their to-do list.

Organizational Culture

• 32% are prioritizing organizational culture to embrace change.

Generative AI

• 32% are prioritizing generative AI for internal use.

How Do Middle Eastern Banks Think They Stack Up?

• 75% think they’re ahead of their competitors when it comes to their ability to transform customer experiences.
• 94% believe they’re ahead in key development areas, such as innovation for products and services.

Additional Metrics:

• Speed: 74% believe they are ahead in speed of transformation.
• Investment: 20% believe they are ahead in investment.
• Capabilities: 84% believe they are ahead in capabilities.

Internal Uses of Generative AI Are the Focus—for Now

Approximately 66% of banks are pursuing transactional generative AI use cases such as credit analysis, portfolio management, underwriting, risk measurement, legal contracts, proposals, RFPs, pitch documents, and more.

For further information, contact:

• david.murphy@publicissapient.com
• james.whitaker@publicissapient.com

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