PUBLISHED DATE: 2025-08-12 18:55:15

GLOBAL BANKING BENCHMARK STUDY 2024

Digital Transformation: What’s Next for U.K. Banks?

The Inside Story from 220 Senior U.K. Banking Leaders

To uncover the current state of digital transformation in U.K. banking, we surveyed 220 senior leaders from across the sector. We asked them about the progress of their transformation initiatives, the main challenges they face, and how they are prioritizing their strategies for the future.

Key Stats at a Glance

75% of respondents admit that evolving customer expectations have exposed weaknesses in their organization’s current customer experience.
66% believe their firm’s legacy systems and infrastructure are hindering their ability to provide the digital experiences customers expect.
45% cite AI and emerging technologies as their company’s number one priority over the next three years, just below the 46% who cite cybersecurity.
34% of U.K. banks have adopted an agile operating model.

Top Priorities for Digital Business Transformation in U.K. Banks:

16%: Improving cybersecurity
15%: Improving the customer experience
15%: Reducing costs through improved efficiency
14%: Growing revenue with new products and/or service offerings
12%: Growing revenue from existing products
11%: Enabling greater agility
11%: Acquiring new customers
6%: Challenging the threat posed by new market entrants (e.g., Google, Apple, Amazon)

Main Barriers to Transformation:

Lack of budget: 36%
Legacy technology: 32%
Regulatory challenges: 31%

Personalizing Customer Journeys is a Priority for U.K. Banks

Banks are eager to leverage data to create new products and services that deliver more personalized, omnichannel experiences.

40% state that making personalized customer journeys (such as tailored marketing and personalized saving tips based on individual spending habits) is their top customer experience transformation priority.
39% say that omnichannel servicing to enable seamless customer journeys is a key priority.
35% highlight offering new financial services and products as a main priority.

U.K. Banks Want to Become More Agile

Banks are transforming to survive in a customer-centric digital era, but access to data, technology, and platforms remains a challenge.

35% say that moving to a modern cloud-based core banking system is their key priority.
34% identify moving to the cloud as a key operational transformation priority.
32% are focusing on developing existing talent (upskilling and reskilling), with 29% citing a lack of workforce skills or willingness to embrace change as their biggest transformation barrier.
31% say their business needs to be more agile.

How Do U.K. Banks Think They Stack Up?

63% believe they are ahead of their competitors in their ability to transform customer experiences.
91% think they are ahead in key development areas, such as innovation for products and services.

AI is Now in Play

U.K. banks recognize the potential of AI technologies to accelerate digital transformation.

75% believe AI’s greatest potential lies in making processes more efficient, profitable, and faster, rather than simply doing them better or more accurately.
30% of banks’ customer experience digital transformation investment will be prioritized for machine learning, AI, and generative AI.
76% say they will prioritize non-customer-facing generative AI over the next three years to improve internal capabilities.

Internal Uses of Generative AI Are the Focus—for Now

Approximately 60% of banks are pursuing transactional generative AI use cases, including credit analysis, portfolio management, underwriting, risk measurement, legal contracts, proposals, RFPs, pitch documents, and more.

Contact:

Dave Murphy
Financial Services Lead, International
david.murphy@publicissapient.com

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